Aviva has produced a report highlighting the fact that false whiplash claims have resulted in car insurance premiums increasing by £118 per annum. In the last 4 years premiums have gone up by 80% as a result of both legitimate and false whiplash claims being made.
Many such claims are placed on behalf of the policyholder by third parties such as personal injury lawyers and claims management companies. Nowadays, the average legal costs for a claim for whiplash comes to £2,500. It is estimated that if claims were processed directly with the policyholder £1.5 billion could be wiped off motor insurance premiums.
There are 600,000 whiplash claims every year. It is forecast by Aviva that the cost of processing such claims directly with the policyholder would result in a drop of 50 per cent. This could save the average motorist £60 per annum in car insurance premiums.
Dominic Clayden, who is the claims director at Aviva, stated: ‘Our figures for average compensation settlements show that dealing with an insurer directly results in at least as much compensation for the claimant and has the advantage of being quicker, meaning their treatment and rehabilitation can start almost immediately.”
During the last 6 years, personal injury claims emanating from road traffic accidents have gone up by 70 per cent. It is estimated by the Association of British Insurers that in excess of 25 per cent of whiplash claims are false.
To produce the report, two thousand drivers took part in the survey. Of those, a staggering 63 per cent felt that people would claim and use the money for some other reason other than to cover rehabilitation expenses. In excess of 50 per cent of people taking part in the survey were supportive of a panel of independent medical experts assessing cases of whiplash.
Let us hope that something comes out of the Ministry of Justice Whiplash consultation that is scheduled to be closed on the 8th March 2013.