Guest post regarding whiplash compensation claims in the UK.
As part of an inquiry into how to drive down the cost of car insurance, MPs are set to launch a new investigation into how to reduce the number of whiplash compensation claims.
It has been reported that whiplash costs add around £90 to every motor premium, and The Transport Committee is calling for evidence on how this can be reduced.
Britain is referred to as ‘the whiplash capital of the world’ and The Transport Committee wants to ascertain what proportion of costs are caused by people faking their injuries, as whiplash is known to be extremely difficult for GPs to diagnose.
As a result of this, the cost of the average motor insurance policy is being pushed up by around 20%; even more staggering is the fact that between 2005 and 2010, whiplash claims have increased by 70%, despite the number of road traffic accidents falling by 23%.
It is thought that there are now around 550,000 whiplash claims per year, which equates to 1,500 per day; this leaves insurers with a compensation bill of around £2bn, and up to £2,500 of every whiplash compensation claim is wasted on legal fees and other unnecessary payments.
There are a number of steps that could be taken to reduce the number of spurious or exaggerated whiplash compensation claims in the UK.
For example, one possible course of action could be to offer fixed rates of whiplash compensation, and withhold a proportion of the compensation to directly pay for treatment, such as physiotherapy and rehabilitation.
Alternatively, the system favoured in Germany and Austria could be used, where road traffic accidents are assessed using expert vehicle damage analysis, and any collisions that are below a certain speed are regarded as being too low to result any whiplash related injuries.
Another alternative course of action could be to introduce compulsory medical examinations for anybody wanting to make a whiplash compensation claim, which should hopefully curb the flow of spurious cases.
This practice is already being used by some whiplash compensation firms in the UK, such as Winn Solicitors, but there are calls to standardise this practice in order to cure the ‘epidemic’ of exaggerated whiplash claims; the Association of British Insurers (ABI) have also called for anyone whose whiplash claim turns out to be even partly exaggerated should automatically have their whole case thrown out.
The aim of these measures is to ensure that claimants are expertly assessed, and that compensation is paid to genuine claimants more quickly; they should also help to deter anyone that thinks a spurious whiplash claim is free money waiting to be collected.
If improved measures are introduced in the UK, one important factor that needs to be taken into consideration is that access to justice for injured people is preserved.
The Transport Committee will look at whether the government could be taking further action to reduce the cost of car insurance and wants written submissions by 15 April.