The cost of claims both legitimate and faked

Industry news roundup: week ended 16 Sept 2013:

Whether it’s spurious or legitimate, an accident claim has a serious cost – and not just to the party held responsible for the injury!

Claims fraud is, for example, a serious problem right now in the UK. Why, just the other day there was a massive scam uncovered where two blokes tried to bilk £77,000 from an insurance company – and if they had succeeded, it would have been all of us who would have ended up footing the bill!

Luckily these two bastards, Darren Gallimore and Kenneth Nash, were caught as they were in the midst of organising their ‘cash for crash’ whiplash claim with the help of several other family members. Thankfully an investigation by the insurer discovered that the so-called ‘accident’ might not have ever occurred, and further probing saw the plan uncovered – now the two ringleaders are spending a nice, long 12 months in prison for their attempts to defraud. Good, I say – my insurance premiums are high enough without them having to rocket upwards because my firm needs to recover the cost of fraudulent claims!

But just because fraudulent claims tend to be for ungodly amounts of cash doesn’t mean that legitimate claims can’t be as expensive. In fact, a new Freedom of Information request recently revealed that Blackpool Council is currently being sued for in excess of £45,000 from school-related injuries alone!

That’s right – staff, pupils, and even visitors to Blackpool schools are getting injured left and right it seems. There were some 36 claims that were currently working their way through the courts at the moment, with the most recent being May of this year and the oldest stemming from September of 2010, and the injuries range from simple slips and trips to ending up injured after being hit by a football.

I’m not saying that people don’t end up hurt from accidents – it happens, we all know it – but being hit by a football? Is that truly something that passes for being injured enough to make a claim for personal injury compensation? Sure I can see getting your nose bloodied by an errant, out of control football, but for pity’s sake don’t claim thousands of pounds in injury!

Liverpool: whiplash claim capital of the UK

A new survey has discovered that Liverpool could be considered the whiplash capital of the UK, as the number of whiplash claims being made within the city leaves the rest of the country’s figures to pale in comparison.

22 out of every 1,000 people in Liverpool reported suffering from whiplash after a road traffic accident, which beat out both Uxbridge’s 21 and Oldham’s 20 to claim the dubious honour of the top spot.  However, there are parts of Scotland that boast much lower figures, such as the Dundee and Edinburgh areas that have only three whiplash-related claims for every thousand general car accident claims, the survey discovered.

Spurious claims cost £2 billion every year the insurance industry says, which can account to an additional £90 being tacked on to every motorist’s insurance policy as a result.  Things have gotten much worse in only a few years, as whiplash claims have rocket by 70 per cent over the second half of the last decade, even as the number of accidents actually declined by 23 per cent over the same period of time.

Scotland seems to have the safest and most honest drivers place in nearly every instance, as a Freedom of Information request discovered that 90 per cent of the postcodes with the least number of whiplash-related claims occurred within the country.  Industry experts say that this could be the result of a legal system which has much more stringent controls in place than in other regions of the UK.

93% of Brits support government clampdown on whiplash claims

An overwhelming majority of Brits are completely fed up with the personal injury compensation sector, with a massive 93 per cent supporting any government clampdown on accident claims involving whiplash, a new survey recently discovered.

Two out of every three drivers surveyed by the research study said that the government’s new proposed plans to subject whiplash claims to closer medical scrutiny because the UK’s ‘compensation culture’ has gotten completely out of hand.  Meanwhile, an additional 27 per cent remarked that the new proposals, which would see alleged victims of whiplash assessed by independent doctor panels, were needed in order to stop car insurance costs from going up any more than they already have.

People are simply fed up with having to fit the legal bill for the insurance industry as a result of the surge of whiplash claims, experts say, as current estimates exist that claim whiplash-related legal matters cost insurers £2 billion in compensation payments in 2011 alone, and that this £2 billion is recovered from honest, harried motorists by raising the average premium price by around £90.  Insurance specialists have welcomed the new proposals as well, adding that it’s another important step in managing motoring costs for UK drivers.

Industry experts said they were encouraged to see the government continuing to take action, much as they did last year in banning personal injury lawyers from taking referral fees, which were found to be one of the biggest reasons the number of car accident claim figures were rising at such an unmanageable pace.  Things had gotten so bad that, even though the number of car accidents have gone down by around 23 per cent over the last six years, the number of claims being made had actually increased by a factor of 70 per cent – something industry insiders blamed on lawyers and claims management companies flogging lists of personal details purchased from insurers to look for drivers interested in making a claim.