Car insurance: MPs to investigate impact of whiplash claims

 
Car accident Whiplash accounts for an estimated 70% of road accident personal injury claims

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MPs are to investigate the extent to which claims for whiplash injuries are pushing up the cost of car insurance.

The Commons Transport Committee said it wanted to examine suggestions that rising payouts meant the UK was now the "whiplash capital of the world".

It will look at the impact fabricated and exaggerated claims have on premiums and what can be done about them.

Ministers say action is needed to curb the 60% increase in road-related personal injury claims since 2006.

Whiplash is characterised by the NHS as a neck injury caused by a sudden movement of the head forwards, backwards or sideways.

Claims for such injuries have soared in recent years despite improvements in vehicle safety and a sharp reduction in the number of reported accidents involving personal injury.

The cross-party committee has already held two inquiries into the rising cost of car insurance in the past three years.

But now it plans to focus specifically on claims for whiplash injuries - of which there were more than half a million last year - and how they affect what drivers are paying for insurance.

'Epidemic'

Insurers say there has been an "epidemic" of claims - with 1,500 made every day - and their £2bn annual cost is adding £90 to the average premium.

Start Quote

Whiplash is notoriously difficult to diagnose, which means that for too many people it has become the fraud of choice”

End Quote James Dalton Association of British Insurers

In a consultation document published in December, the Ministry of Justice set out ideas for action, including creating new medical panels to improve diagnosis of whiplash injuries and allowing more cases to be challenged in the small claims court.

The committee wants to know whether the government's proposals will reduce the cost of premiums and what proportion of the £90 figure is attributable to inaccurate or fraudulent claims.

It will also study the likely impact of the proposals on genuine claimants and what else can be done to bring down premiums.

Louise Ellman, the Labour MP who chairs the committee, said the issue was "difficult", but she and her colleagues wanted to weigh up all the arguments about the best way forward.

"It is vitally important for policymakers to understand the reasons for the very high cost of motor insurance, especially for young drivers and to take steps to bring that cost down," she added.

"Whiplash claims undoubtedly play a part in driving up the cost of motor insurance but access to justice for injured people must be preserved."

'Fraud of choice'

Former Justice Secretary Jack Straw has mounted a high-profile campaign against what he says is the large increase in dubious whiplash claims, tabling a private member's bill in 2011 urging reform of motor insurance.

The Association of British Insurers has called for whiplash injuries to be assessed by an accredited medical expert, trained in the latest diagnostic techniques and able to take into account the circumstances of the collision rather than the claimant's reported symptoms.

Start Quote

We continue to work with young people, the insurance industry, and other key partners in addressing this important issue”

End Quote Stephen Hammond Roads minister

It also says a set level of damages should be prescribed for whiplash claims and any exaggerated claim should be thrown out entirely.

"Insurers want to make it simpler and quicker for genuine whiplash claimants to get fair compensation," says the body's assistant director of motor and liability James Dalton.

"But whiplash is notoriously difficult to diagnose, which means that for too many people it has become the fraud of choice."

The government said it had taken action to help bring down insurance premiums by banning referral fees, reforming no win no fee rules and cracking down on fraudulent whiplash claims.

"In addition, we are considering several options to ensure that newly qualified drivers are properly prepared and drive safely, allowing insurers to reduce premiums for this age group," Roads Minister Stephen Hammond said.

"We continue to work with young people, the insurance industry, and other key partners in addressing this important issue."

 

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  • rate this
    +2

    Comment number 115.

    Bent doctors lawyers and "insurance" firms.
    51st state it is then !

  • rate this
    +3

    Comment number 114.

    People see is ££££s after any kind of incident

    Unfortunately its all people seem to be bothered about these days

  • rate this
    +5

    Comment number 113.

    Commit a first class police and national security team to whiplash fraud scammers, convict the fraudsters to Belmarsh under maximum term, expose their families to public scrutiny and recover the money obtained.

    Solicitors involved should be barred, expenses and costs recovered and they also, shamed in public.

    simple$

  • rate this
    +2

    Comment number 112.

    All these people need is a letter from a doctor and they will make a claim, and a doctor cant refute what you say about pain so they get away with it, obviously there are many claims that are justified but not all,and a lot are down to these claimant solicitors who make a fortune in fees and find out from insurance companies who have had accidents and pester people to make a claim.

  • rate this
    +1

    Comment number 111.

    I think it's bad that the costs of this are passed onto other motorists, but I've got no sympathy for people who cause accidents through incompetent driving and get sued for it. These are the people we should be blaming. There's way too many rubbish drivers on the road and I'm happy to see them get sued, even if it's for unprovable whiplash. It's just a shame the insurance company pays it for them

  • rate this
    +3

    Comment number 110.

    There should be Penalty for People who make false claim.The Claiment and also his Agents who help to lodge claims.

  • rate this
    -4

    Comment number 109.

    I see that both my posting (97) and posting 104 which has a most similar message have been down arrowed.

    Clearly some person(s) does not wish to see this activity stopped.

  • rate this
    +4

    Comment number 108.

    Why are there so few prosecutions for fraudulent insurance claims? The insurance industry whinges on but when they receive a claim they almost always pay up without any real investigation. Since they are the main beneficiaries or premium inflation they have a huge conflict of interest. A few long prison terms for fraudulent claimants would surely reduce this problem but insurers don't want to!

  • rate this
    +2

    Comment number 107.

    As someone else has suggested. Any compensation claim for a hard to prove/disprove condition, such as whiplash, should be restricted to payment for physio or for time off sick from work of over 3 days. There should be no single compensation hand out in cash.

  • rate this
    +3

    Comment number 106.

    This is not a new phenomenon. 20 years ago I was involved in a very minor accident - I was rear-ended in very slow moving traffic, pushing me into the back of the car in front of me, occupied by the driver and one passenger. However, once the insurance process got under way the driver in front's claim referred to a "violent collision" resulting in *four* people suffering whiplash injuries.

  • rate this
    +1

    Comment number 105.

    No more No Win calls ban them, no more doctors and specialists in the pay of solicitors most of them are employed by the NHS so why should they have extra income from these people and mostly more indepth investigation into these scammers time for innocent motorists to get a break, and if the fraudsters do win a claim increase thier insurance 10 fold. Time to stop rip off britain !!!

  • rate this
    +5

    Comment number 104.

    Just set up a simple scheme where anyone who provides video evidence showing a claimant is faking it gets the money instead, and claims will drop to zero overnight.

    People do it because there is no risk of getting caught, and even if they do there are no consequences.

    Paying informants instead and arresting people for fraud will solve the problem.

  • rate this
    +2

    Comment number 103.

    It is vitally important for policymakers to understand the reasons for the very high cost of motor insurance, especially for young drivers and to take steps to bring that cost down," she added.
    Dont know how they can detect liars but maybe relating insurance to the risk of having an accident might help but the Insurance co.s were forced to withdraw this aspect of quoting for female drivers.

  • rate this
    +2

    Comment number 102.

    The impression I'm getting is that a high proportion of whiplash claims are false or exaggerated. If so we should maybe consider rejecting all such claims that can't be proved beyond reasonable doubt, instead of throwing the emphasis on insurers to prove it false. After all there are many other areas of insuramce loss where there is no payout without proof.

  • rate this
    +3

    Comment number 101.

    If insurance companies paid out the true replacement cost for a car when someone else writes it off, then maybe people would not feel obliged to get value for money out of their hideously overpriced insurance premiums, by claiming whiplash. It's a mandatory insurance, it should be added to the VED and removed from the private sector rip off merchants.

  • rate this
    +3

    Comment number 100.

    I spent 5 years working in motor claims and i have to say its not insurers, but the dodgy claims companies who spring up offering injury advice, rental cars and then charging huge fees.

    Poeple will always for an easy pay out, but until recently they havent had dodgy companies inflating claims to help them. Liscencing and auditing could solve that.

  • rate this
    0

    Comment number 99.

    I got whiplash because I got over-excited when a PPI claims company called and told me I could get £6,000.00 in compensation for being mis-sold PPI. This was just after the call had saying I could get £10.000.00 compensation because of the accident I had last yr. I'm also claiming medical negligence for the treatment of my whiplash. That's another £10k.

  • rate this
    0

    Comment number 98.

    NOTE ~ Insurers are meeting significant increase in costs of business in enhanced capital requirements. A whinge at whiplash cons diverts attention from the industries attempt to pass costs of general business onto vehicle claims insurance. Motor insurers also cover everything else on the planet and premiums to business, are not increasing. Clever people are being cunning.

  • rate this
    +2

    Comment number 97.

    In the case of clearly CRASH FOR CASH cases, prosecute all involved in making the false claim for FRAUD and / or PERVERTING THE COURSE OF JUSTICE.

  • rate this
    +6

    Comment number 96.

    Lawyers are supposed to abide by a Professional Code of Conduct.

    It should be illegal for a solicititor to tout for work.

 

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