The Association of British Insurers has recently called for reforms to the civil litigation system in the UK due to excessive personal injury claim costs that cost UK consumers £2.7 million on a daily basis.
According to Association findings, UK consumers pay the legal profession a total of £2.7 million, as approximately 10 per cent of every motor insurance premium is paid directly to personal injury lawyers as a result of an accident claim lawsuit. The ABI stated that each insurance policy holder pays an extra £41 in motor insurance premiums as a result.
The ABI also stated that 87 pence is paid out in legal costs for every £1 pound paid out in personal injury compensation to motor accident victims in the UK.
Nick Starling, director of general insurance and health for the ABI, stated that many people are of the belief that there is an exploitable compensation culture here in the UK. These sentiments are often encouraged by claims management companies, Mr Starling added.
The insurance director remarked that the current system is failing genuine claimants who more often than not need to wait much too long for the compensation awards that they need. Additionally, all consumers in the UK end up footing the bill through increased insurance premiums, he commented.
As a result of these inflated costs, the ABI has formally endorsed the implementation of all recommendations put forth by Lord Justice Jackson in his recent compensation culture report. The ABI states that the proposed changes will lead to a more cost-effective, fairer, and faster level of care and compensation to those who are in the most need of it.