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Government calls for action on rising whiplash claimsBack

MPs have announced today that the rise in car insurance costs is down to the increasing amount of people making claims for whiplash following an accident.

The Transport Select Committee has stressed that claimants need to prove that they have actually suffered a whiplash injury, and it has suggested that all future whiplash claims should be supported by proper evidence.

MPs are also campaigning for insurers to be banned from selling on information about customers to accident and injury claims companies. The committee has pointed out that in the past six years, there has been a 70 per cent rise in motor insurance claims, yet at the same time, there has been a 23 per cent drop in the number of casualties actually caused by road accidents. Whiplash has also accounted for 70 per cent of all personal injury claims.

Louise Ellman, chair of the Transport Committee, said: “Insurers, solicitors and claims management companies have themselves driven up the cost of motor premiums by encouraging people caught up in road accidents they did not cause to claim for personal injury, car hire, and other legal costs.”

“The insurance industry must abandon sharp practices that push up premiums such as passing drivers’ personal data to other parties or taking secretive referral fees from solicitors, garages and car hire firms,” she added.

Louise Ellman went on to explain how many of the claims are for whiplash which is an injury where diagnosis can be subjective and therefore costly for insurers to challenge. She has suggested that the threshold for receiving compensation for whiplash claims should be raised, and if this is not enough to make the amount of claims fall then the government should create legislation which requires objective evidence, both of the actual whiplash injury and the effect it has had on the claimant’s life. Only then should a decision about compensation be made.

Nick Starling from the Association of British Insurers (ABI) has backed the government’s call for action to restrict whiplash claims and has agreed that payment of referral fees should be banned altogether, not just to insurers but to all organisations.

“It is absolutely critical that Britain’s whiplash epidemic is tackled once and for all and the select committee’s acknowledgment that the bar to receiving compensation for whiplash is too low is a step in the right direction,” said Nick Starling of the ABI.

“Our customers are fed up of getting text messages, fed up of the compensation culture and have had enough of paying higher car insurance premiums to line the pockets of ambulance chasing lawyers and claims management companies,” he added.

 

Posted by Leana Kell on 12/01/2012