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AA Insurance has welcomed the House of Commons Transport Committee's report on whiplash injury claims published on 31 July 2013. The inquiry was concerned with the cost of motor insurance and ways of reducing the number of whiplash claims.
We are pleased that MPs recognise the delicate balance that must be struck between genuine claimants and those who are, in effect, trying to earn a 'quick buck' by exaggerating an injury after a road collision – or indeed have not been injured at all.
There is no doubt that fraudulent and exaggerated whiplash injury claims have inflated premiums and have tarnished the reputation of the legal and insurance professions.
Simon Douglas, director of AA Insurance
Simon Douglas, director of AA Insurance, commented: "In the continuing debate about whiplash injury claims I have always emphasised the need to ensure that those who have a legitimate claim should not be put off from seeking the compensation for their injury that they deserve." Mr Douglas also noted the MPs surprise that making a whiplash injury claim has been 'too easy'.
However, the burden of proof falls on the defending insurance company, and because all but serious whiplash injury can't easily be diagnosed the insurance company can end up paying both the costs of a court defence as well as compensation and legal fees.
There is no doubt that fraudulent and exaggerated whiplash injury claims have inflated premiums and have tarnished the reputation of the legal and insurance professions. We are already seeing some benefits of LASPO [The Legal Aid, Sentencing and Punishment of Offenders Act] measures whereby the number of personal injury claim firms has fallen dramatically.
In response to this car insurance premiums have in turn fallen over recent months, which trend underlines the industry's commitment to passing on cost savings to customers.
Although the Transport Committee is cautious about increasing the small claims limit from £1,000 to £5,000 – which is being considered by the Ministry of Justice – we believe that this will prove to be a significant disincentive to those without a legitimate injury 'chancing their luck' at winning a settlement.
We also welcome the Committee's agreement that more robust measures should be put in place to confirm the medical likelihood that an injury has taken place.
Whether it's true or not, Britain has earned the shameful reputation of being the 'whiplash capital of Europe'. We hope that the recommendations of the Transport Committee as well as the Ministry of Justice proposals will put that behind us for good.
Read our advice on how you can reduce the risk of whiplash injury.
31 July 2013