While the insurance industry and the Government continue to discuss Britain’s whiplash compensation culture, the AA says it’s now time for the talking to stop and time for reforms to be put in place.
On Wednesday 02 May, Transport Secretary Justine Greening MP and Justice Secretary Kenneth Clarke MP will unveil whiplash injury reforms at a second insurance summit in Whitehall (the first, hosted by the Prime Minister, was at 10 Downing Street in February).
Over the past two years, claims for whiplash injury have contributed to the biggest car insurance premium increases ever recorded by the AA’s benchmark British Insurance Premium Index. In 2010, the fast-rising premiums recorded by the AA Index prompted a Transport Committee enquiry into car insurance.
Over the two years ending 31st March, the average Shoparound quote for a comprehensive policy rose by nearly 50%.
Simon Douglas, director of AA Insurance, says that there has now been enough talking and hopes that the Summit is the last talking shop.
“I hope that Wednesday’s announcement will see a tight timescale applied to reform of the civil litigation which at present, encourages people to make a claim regardless of how serious their injury is or even if they have not suffered injury at all. Importantly, we need reforms that clamp down on cold-call claims management and personally injury firms who have contributed to the growth of claims.
“The present dysfunctional system has also spawned a fraudulent multi-million pound ‘cash for crash’ industry.
“Whiplash injury claims cost insurers over £2 billion** last year. That adds around £90 to the cost of a typical car insurance policy.”
Mr Douglas said that he was disappointed in the slow rate of progress shown in the Transport Committee’s latest report, published in April.
“But I acknowledge that a lot of momentum has built up,” he says. “Reform can’t come soon enough. It is wrong that injury claims are rising while the number of accidents on Britain’s roads is falling.”
