Whiplash claims must be reduced, say MPs and insurers

A committee of MPs will look at how the number and cost of whiplash claims in the UK can be reduced.

The House of Commons Transport Committee inquiry follows a December 2012 whitepaper from the Ministry of Justice (MoJ), which described Britain as the "whiplash capital of the world".

The whitepaper reported that, between 2006 and 2012, there was a 60 per cent rise in claims for personal injury caused by road traffic accidents despite a 20 per cent fall in the number of reported accidents over the same period.

The Committee's inquiry will also look to establish:

  • whether whiplash claims add £90 to the average premium as claimed
  • what proportion of this additional cost is due to "exaggerated, misrepresented or fabricated" claims
  • whether the Government's proposals to tackle fraudulent claims will help reduce insurance premiums
  • the impact of the proposals on access to justice for genuinely injured claimants
  • whether the Government could do more to reduce the cost of motor insurance.

Louise Ellman MP, the chair of the Committee, said: "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. Whiplash claims undoubtedly play a part in driving up the cost of motor insurance, but access to justice for injured people must be preserved."

Simon Douglas, director of insurance at the AA, said: "In my view, while there is clearly a need to bring the escalating number of often-spurious claims under control, there are steps that could usefully help - for example, fixed rates of compensation and a proportion of claims payment withheld and paid direct for treatment, such as physiotherapy. Similarly, historic claims should reflect the cost of treatment that sufferers have, or should have, undertaken."

The Association of British Insurers (ABI) has set out proposals for reducing the number and cost of whiplash claims, which include:

  • independent medical assessments of whiplash claims by accredited medical experts
  • assessments would take into account the circumstances of the collision rather than the claimant's reported symptoms 
  • a laid down prescribed level - independently-set - of damage awards for whiplash.

James Dalton, the ABI's assistant director of motor and liability, said: "Our proposals will ensure better medical assessment of whiplash claims, offer a quick, simple way of paying genuine claims; provide certainty for claimants and compensators, and deter fraud that ends up being paid for through higher motor insurance premiums."

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