Whiplash settlement process called into question
While car insurance premiums are falling, the Transport Committee’s fourth report on the cost of motor insurance since 2010 took aim at the “dysfunctional” market. The report accused insurers of encouraging fraudulent and exaggerated motor insurance claims, particularly for whiplash injuries, by settling cases prior to a medical examination.
The report called on the Government to prohibit any settlement before the claimant has undergone a medical examination by a genuinely independent doctor.
Martin Milliner, Claims Director at LV= Car Insurance, called the principle “admirable but completely out of touch”.
He said: “Such a suggestion would in fact drive up costs and therefore premiums and give even more power to claimant lawyers in what is an already imbalanced process. On this point, the Transport Committee has failed to understand why insurers are compelled to in some cases settle on a pre-med basis in order to keep the overall cost of insurance down.”
The Transport Committee also agreed with a proposed ban on solicitors offering gifts – such as tablet computers and cash – to those considering making claims.
The committee also called for compulsory data sharing between insurers and solicitors in regards to potentially fraudulent claims and a curb on “new forms of potentially dishonest practice” like ordering medical reports on accident-related psychological harm.
The report said: “The Government should press the Solicitors Regulation Authority to stop solicitors from playing the system to maximise their income from unnecessary medical reports.”
According to research from Gocompare.com 1.7 million UK drivers would consider making a claim for personal injury after a raod accident, even if they knew they weren’t badly hurt.
Gocompare.com car insurance expert Lee Griffin said: “Fraudulent and exaggerated claims add to the cost of car insurance for all drivers and we welcome the Transport Committee’s recommendations which seek to curb the spiralling costs associated with such claims.”