‘Merry-go-round’ compensation culture is adding £93 a year to car insurance premiums
Road accidents dropped 40% in 15 years but injury claims were up 89% - and it's having a knock-on effect on consumers
WHIPLASH claims from Britain's 'merry-go-round' compensation culture is adding around £93 a year to people's motoring insurance premium, a report has revealed.
A large number of third party services, such as personal injury lawyers and claims management companies, reply on people making claims to line their pockets - adding £2.5billion to insurance premiums, according to Aviva.
Last year, 80% of the UK's car insurance claims that Aviva dealt with involved whiplash, compared to just 3% in France.
Despite accidents have falling by 40 per cent in 15 years, personal injury claims have leapt by 89 per cent, Aviva's report reveals.
More than 770,000 claims were made last year, eight in ten involving soft tissue injuries like whiplash.
Greedy law firms chasing rake-offs from payouts are bombarding homes with nuisance calls to drum up trade.
That results in additional claims, which in turn means higher insurance premiums.
So for a typical £2,500 payout for whiplash they would rake in as much as £625 plus legal costs.
There has also been a surge in organised crash for cash scams, which soared 98 per cent from 2011 to 2015.
The proposed government reforms - which would replace cash payouts for minor injuries with physical treatment - could cut premiums by £43, or 10 per cent, Aviva said.
They are also considering increasing the upper limit for minor injury claims to be heard in the small claims court from £1,000 to £5,000 - meaning there would be less legal costs.
Since the policy was announced in the Autumn statement last November, the government has not yet launched a consultation.
Maurice Tulloch, of Aviva, said: “Our research shows that the British public is sick and tired of the toxic compensation culture that has increased premiums, fraud and nuisance calls.