Whiplash adding £93 a year to average car insurance premium
New report claims whiplash-type claims returning to near-record levels.
The average car insurance premium is being bumped up by £93 a year as a result of whiplash-type claims.
That’s according to Aviva, which is calling for fundamental reform to address both the number of whiplash claims, which have returned to near-record levels, and the cost.
Around 2,300 a claims a day are going through to the Claims Portal, and by the end of the financial year it looks like 840,000 claims will have been processed. That’s up 9% on the previous year, the equivalent of an extra 200 claims a day.
Aviva said that of the motor injury claims it received in 2014, it found that a whopping 80% included whiplash. That’s a figure far higher than you see elsewhere in Europe. For example, in Germany whiplash features in just 47% of claims, while in France that figure plummets to just 3%.
And the number of whiplash claims are bumping up our premiums. The average motor premium in the UK is £372, 40% more than France and 50% more than in Germany.
The appeal of claiming for whiplash
One reason Aviva highlighted for the growing number of whiplash claims is the huge financial incentives for the third parties who submit the claims. The insurer said its research had found that an incredible 96% of personal injury claims it received last year were brought by third parties, such as claims management firms and personal injury lawyers.
There is also the growing problem of fraudulent claims. Aviva said that last year it saw a 21% increase in organised fraud compared to 2013. So between claims management firms and crooks, there is some very murky motivations behind the rising whiplash-related claims.
Cut the cost of your car insurance with our comparison centre
How to fix the whiplash problem
Aviva reckons the UK’s “compensation culture” is at the root of the problem, and has outlined six ideas which it reckons will result in fewer whiplash claims, lower premiums, and stopping those who attempt to abuse the system.
Reduced limitation period
All claims should be made within 12 months of the accident rather than the usual three-year 'limitation period'. This is still more generous than the system in Sweden, for example, where symptoms must appear and be assessed with four days of the accident.
Time limits and a threshold
The symptoms (which must be more than ‘trivial’) should last longer than three months, and this must be proven by medical records.
Rehab – care, not cash
Insurers should provide up to three months of treatment to policyholders or the injured party, regardless of who is at fault. By removing the financial element, fraudsters won’t be tempted to abuse the system.
Medical evidence
Claimants must obtain an independent medical report from the Government vehicle MedCo between three and 12 months after the accident.
Level of disability
These medical reports should assess the level of disability caused. Compensation would only be recoverable where the expert reckons the level of impairment caused is 10% or more.
Predictable damages
Damages should be awarded against a “clear and transparent tariff”. In other words, you’ll know at the outset what you are likely to get, cutting down on unnecessary toing and froing between legal teams. France, Spain and Norway all have fixed damage tariffs for whiplash-type injuries.
Maurice Tulloch, CEO, UK and Ireland General Insurance at Aviva, said: “Our customers have told us they are fed up with the compensation culture and all its trimmings: the nuisance texts and calls from claims management companies, excessive lawyers’ fees and fraudsters abusing the system for their own financial gain. It doesn’t have to be like this.”
Cut the cost of your car insurance with our comparison centre
More on motoring:
Government promises "end to war on drivers" with new parking fine rules
Most Recent
Comments
-
There was a claim where the driver and his passenger suffered whiplash. Then another passenger made a claim. Then another passenger made a claim. All in all, all fourteen passengers made claims for whiplash injuries from the same accident, even though it is physically impossible for fourteen people to fit in to a Renault Clio. The real irony is that the insurance company paid out all fourteen claims before someone questioned why there were fourteen people in such a small car. It just goes to show that those within the industry cannot be bothered to properly investigate each case, preferring to cover their losses by upping our premiums. No wonder the insurance business is in such a mess, and why we have to bail them out with our own money.
REPORT This comment has been reported. -
I don't know how many years the insurance industry has been bleating on about measures they could impose to stop these vexatious claims. The six measures outlined above seem eminently sensible, so why don't they just get on a do it? It wouldn't of course have anything to do with the fact that it's a lot easier for them to just let the consumer take the hit in their premiums.
REPORT This comment has been reported. -
Humm, I dont suppose this has anything to do with the insurance companies not making as much profit on Car insurance as they posted last year? and then we see an increase in premiums to cover this "increase in claims" just like the "joy riding" epidemic that they used to bump up premiums years ago. The biggest pervasive of fraud are the insurance companies who take your premium but are overly obstructive when they should pay out. I had a similar experiance as Rainbowblah, 300 quid offered. I declined it and they then said I had a claim. which then went down on my insurance record. The next bunch then tried to charge me more as I declared I had not had a claim. They agreed that it was not a claim, but fraudulently said they asked if i had claims or "incidents". Reminded them that the conversation was recorded and they backed down. Basically they are crooks and hypocrites who encourage people to act dishonestly.
REPORT This comment has been reported.
Do you want to comment on this article? You need to be signed in for this feature
22 March 2015