Government vows to cut fees paid in car accident claims

The government has recently taken a vow to reduce the fees paid to personal injury lawyers for injury cases such as car accident claims as the campaign continues to eradicate spurious and costly claims that lead to higher insurance premiums.

In uncontested personal injury cases worth less than £10,000, injury solicitors receive a fixed £1,200 fee.  Anywhere between £600 to £800 of this sum will towards paying a referral fee, as doing so allows them access to the personal information of accident victims in an effort to discover an increased number of those potentially lucrative claimants.

MP Jack Straw recently told the transport select committee that the personal injury claims ‘merry-go-round’ needed to stop, as it can be blamed for pushing insurance premium prices up into the stratosphere.  One specialist insurer, Young Marmalade, submitted a survey to the select committee, discovering that nearly all young motorists feel as if high insurance costs have been working to price them off the road – and one out of every five were even ready to get behind the wheel without insurance at all.

Axa UK chief executive, Paul Evans, also appeared before the committee, in order to state that there would be a guarantee that  insurance providers would cut their prices considerably if lawyers’ fees were done away with.  Mr Evans promised that both premiums will reduce and the number of injury claims in the country would go into decline if there was a reduction in the fixed fee.

However, justice minister Jonathan Djanogly stated that cutting fees is a complicated task due to the fact that the amount that goes towards referral fees differs from one legal expert to another.

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