Backlash on whiplash claims

2012-01-16 09:53

Car insurance premiums are soaring in the UK due to whiplash claims and ambulance-chasing lawyers, a report by British MP's has found.

Now the House of Commons transport committee has called on ministers to change the law to make it harder for people to make uncontested claims for whiplash injuries.

MP's have warned that insurers, solicitors and claims management companies were driving up the costs of insurance premiums by encouraging drivers involved in accidents to claim for personal injury, care hire and legal costs.

According to the London DailyMail, a survey conducted by confused.com com and professional services company Towers Watson found the cost of some car insurance policies soared by as much as 17% in 2011. The average cost of a comprehensive policy soared to the equivalent of R10 500 by the end of 2011 – an increase of nearly five percent since 2010.

Over the past three years the number of whiplash claims has increased to 570 000 a year despite a 16% fall in the number of accidents reported to just over 208 000. An estimated R24-billion a year is paid out although doctors have warned that 25% of claims are fake.

Committee chairman Louise Ellman said claimants should be required to provide evidence of a whiplash injury and prove the alleged injury caused a significant effect on their lives before receiving a pay-out.


Ellman said: "Although we strongly support access to justice, drivers should not be railroaded by cold callers into launching legal action.

"Many of these claims are for whiplash, an injury whose diagnosis is often subjective and therefore very costly for insurers to challenge.

Separate figures from the Insurance Fraud Bureau found that at least 30 000 whiplash claims werre outright fraudulent, costing the equivalent of R4.3-billion a year.

Gareth Kloet, head of car insurance at confused.com, said: “This time last year drivers were paying an eye-watering R10 000 average premium for comprehensive cover which has risen to R10 543 over the past 12 months.”

“In 2012 we can expect to see new factors affecting car insurance prices, such as the introduction of EU legislation due at the end of this year meaning that insurance cannot be priced according to gender."