The Health Department will bow to pressure from the insurance industry and revoke the Road Traffic (NHS Charges) Amendment Regulations at 15:30 today.
The regulations had increased the maximum tariff paid by insurers to £30,000 from £10,000. They were retrospective to 28 January 2002.
However, the Association of British Insurers (ABI) wrote to the department to protest against the lack of consultation over the charges and their retrospective nature.
Lord Hunt of the Wirral also raised the issue in the House of Lords.
However, this afternoon government minister Lord Hunt of King's Heath will announce that the government is to revoke the regulations.
Insiders have said the government will reinstate the old tariffs before embarking on a consultation process.
Lord Hunt of the Wirral paid tribute the health department's swift response to the industry's concern.
"The industry now looks forward to constructive dialogue," he said.
