|
|
|
|
Car Insurance Blog
News and views on motoring and car
insurance
|
Tired
of
paying too much for your cover?
|
|
|
|
|
Car insurance price increase
causes: personal injury claims
2 Feb 2011
by Heather Ferrier
This is the first article in our 'causes of car insurance price
increases' series. In this article, we look at the contribution of
personal injury claims to the rising cost of UK car insurance.
In fact, the biggest contributor to the rising cost of car insurance
has been an increase in the amount and cost of personal injury claims
filed in relation to road traffic accidents.
In England, 25% of road traffic accident claims include a personal
injury claim of which 80% include whiplash.
Former government Minister, Lord Young, and the current Roads Minister,
Mike Penning, have spoken of an emerging UK 'litigation culture' that
has occured alongside an explosion
in the number of claims management
companies as well as aggressive
marketing by injury lawyers.
Indeed, in the North-west of England, where there are the most numbers
of claims management companies, 40% of car insurance claims include a
personal injury claim. In Scotland, were there are no claims management
companies, this figure is only 10%.
Personal injury claims are now responsible for half of the cost of car
insurance.
Lord Jackson, in his review
of civil litigation costs, observed that no
win, no fee cases invariably led to legal fees that were much
greater
than the damages award. The insurance industry has described legal
fees, especially the conditional fee agreements (CFAs) of no win, no
fee cases, as 'disproportionate
and dysfunctional'.
However, the vast majority of these personal injury cases are settled
on a fixed fee regime and legal
costs, overall, have actually been
dropping.
Personal
injury claims have increased by over 30% in the last decade
and, as whiplash is typically settled for around £3,800 per case,
this has had a major effect on the need for car insurance companies to
increase the cost of cover.
Our 'causes of car
insurance
price
increases' series:
Car insurance price increase causes: personal injury claims
(article above)
Car insurance
price increase causes: uninsured drivers
Car insurance
price increase causes: 'fronting'
Car insurance
price increase causes: past claims not disclosed
Car insurance
price increase causes: penalty points not disclosed
Car insurance
price increase causes: increasing fraudulent claims
Car insurance
price increase causes: insurers' price correction
Car insurance
price increase causes: referral fees
Car insurance
price increase causes: expensive courtesy car
Car insurance
price increase causes: avoidable legal fees
Car insurance
price increase causes: high cost cases
Car insurance
price increase causes: insurers' income drop
Car insurance
price increase causes: double recovery fees
Car insurance
price increase causes: penalty points 'swapping'
Car insurance
price increase causes: 2 harsh winters
Executive Summary:
The 15 causes of rising car insurance prices
Car insurance
price increase causes: Conclusions
More
Articles >> Article
Series - Listings
|
|
back to
top
car
insurance supermarket
Copyright
© car insurance uk supermarket
|
|
|
|
|
|
