Car Insurance
Government aims to weed out fraudulent #insurance claims
May 8th
With the cost of whiplash running at around £2bn a year, the government is stepping up its attempts to weed out fraudulent and speculative personal injury claims.
A motor insurance summit last month came up with a number of proposals to tackle ‘questionable’ medical evidence and help the insurance industry challenge the rising tide of spurious claims. Fraudulent personal injury claims are responsible for adding around £90 to the price of every motor insurance policy in the UK and the government is keen to add new powers to help insurers discriminate between false and legitimate insurance claims.
A consultation paper is expected this summer which will conclude on the feasibility of various measures such as introducing independent medical panels to arbitrate on claims.
New clampdown proposed for whiplash claims #insurance
Apr 24th
With the cost of fraudulent personal injury claims adding around £40 a year to every driver’s premium, the government is stepping up its campaign against the fraudsters and ambulance chasers.
Plans announced last week by the transport select committee aim to clamp down on fraudulent claims with measures designed to promote greater transparency. At the heart of the committee’s proposals are plans to make the DVLA driver record database available to insurers, allowing them to check the details that are provided on an insurance application form. The thinking behind this is that this additional information should enable insurers to make better informed judgements about who they ensure and for how much.
So far, the measures announced by the committee have been met with approval by the industry as a whole. We agree that more steps need to be taken in order to reduce the risk of fraud and bring premiums down.
UK Government to clamp down on insurance fraud
Feb 20th
The Prime Minister has agreed to introduce new rules to help cut the £2bn cost of whiplash claims that the motor insurance industry faces every year.
With a staggering 1,500 whiplash claims being lodged every day, the PM has decided that it’s finally time to raise the threshold for claims.
Whiplash claims have risen by a third over the last three years, that’s despite car accidents actually falling by around 16% and the insurance industry is pressing for a minimum speed for whiplash claims to be accepted as well as tighter restrictions around medical evidence.
Overall, the government’s new stance on compensation culture has been welcomed by the insurance industry.
ABI director general Otto Thoresen said: “The cost of motor insurance reflects our society where it is all too easy to make spurious and exaggerated personal injury claims, where excessive legal costs can outstrip compensation awards and that tolerates the high levels of deaths and serious injuries involving young drivers and their passengers. Urgent action is needed to tackle the surge in whiplash claims which now cost insurers £2bn a year and push up premiums for all motorists”.
GPs sound the alarm on car insurance fraud
Jan 19th
A staggering 87% of British GPs believe that they have seen patients deliberately faking whiplash injuries in order to make fraudulent car or personal insurance claims.
The results of a new survey suggest that this sort of fraudulent claim has risen significantly over the last two years as motorists try to make a quick buck on minor car accidents and injuries. According to the data, 60% of people injured in a car accident in the last 12 months had been contacted by claims organisations encouraging them to cash in and make a claim.
It doesn’t stop there. 60% of the GPs also reported that they had been contacted by claims management firms last year and 20% claimed that they receive a call every week from a claims company trying to get details of patient’s details.
ABI calls for night time driving ban
Dec 1st
In a radical suggestion that’s likely to cause much debate and publicity a leading insurance industry body, the ABI (Association of British Insurers), has called for stringent restrictions on driving activities for the under 25s. The ABI represents the views of many major insurers on the UK and these suggestions reflect the growing sense of unease among insurers about the number of motor accidents that can be attributed to young or inexperienced drivers.
According to statistics, one in four of all motor related deaths in the UK is a young driver or one of their passengers. This is despite the fact that young drivers account for only 12% of all motorists. The problem is particularly serious with young male drivers who are on average five times more likely to be involved in a serious motor accident than their older counterparts. A recent EU ruling made it illegal (on grounds of sexual discrimination) for insurance companies to price policies on the basis of gender so insurers face the problem of not being able to set a higher premium for young male drivers. The ABI’s suggestions will be seen by many as a way of addressing this issue. So what exactly did the ABI call for?
- A minimum one year learning period. This is actually quite common in other parts of Europe. Essentially this would mean that a learner driver would have to meet a minimum time period and a minimum number of lessons before being allowed to apply for a driving test.
- A ban on night time driving (between the hours of 11pm and 4am) for all drivers under 25 who have not held a full licence for one year. As the vast majority of serious accidents involving young people occur during night time hours, the proposal would ban the under 25s from driving during the night.
- A complete ban on alcohol consumption for the under 25s. The under 25 age group are more than twice as likely to fail a breathalyser test as older motorists, so complete ban is proposed to remove any uncertainty and doubt as to what the legal limit is.
The AA are already positioning themselves against the ABI’s suggestions. It remains to be seen whether the department of transport and the government take any notice.
New report points to car vandalism hotspots
Nov 28th
Waking up in the morning to find your wing mirrors hanging off is not a good feeling. A newly released survey throws some light on car vandalism (malicious damage in insurance-speak) and point to the top 10 car vandalism hotspots in the UK. Basically, if you live in one of these places there’s a reasonable chance that you’ll wake up tomorrow to a great big key scratch.
- Enfield
- South East London
- Bournemouth
- North West London
- Brighton
- Southall
- Romford
- Southend on Sea
- Rochester
- Edinburgh
In addition to this list, the report also points to how widespread this type of activity has become. 54% of British motorists have been the victim of car vandalism and 10% of us have had something like this happen to our cars in the past 12 months. In terms of the sort of damage that was inflicted, ‘keying’ was the most common, accounting for about one third of all damage. Smashed windows accounts for about one quarter of all incidents and slashed tyres about one tenth.
The report also suggests what might motivate car vandalism. Interestingly, you’re significantly more likely to experience vandalism if you drive a BMW, Audi, Mercedes or other prestige brand. Less notable cars such as Fords and Citroens are much less likely to fall victim, suggesting that an unhealthy mix of spite and envy motivate most acts of vandalism.
Most comprehensive policies will cover acts of malicious damage so make sure you’re covered (particularly if you live in Enfield). If you’re not sure – why not give us a call?
Cash for crash fraudsters move out to the country #insurance
Nov 4th
“Cash for crash” fraud is a major problem on the UK’s roads and it’s a subject that has gathered a lot of attention recently from the police and the press. It’s a pretty simple scam where a fraudster deliberately causes a low speed accident in order to claim fraudulently for personal injuries. Typical tactics the fraudsters use are making sudden stops at roundabouts, junctions and slip roads that force the victims car to crash into the back of them.
Now as, the UK’s police wise up to this scam, it seems that the fraudsters are taking their tricks away from urban areas and into the countryside. The North West is still the scammers’ favourite hunting ground but it looks like the craze is spreading to other parts of the UK.
So here are the two worst locations for staged accidents in the UK.
- A406 Eastbound junctions with Abbey Road, Barking
- Hanger Lane Gyratory
We’ve blogged a few time about cash for crash and provided this helpful guide on how to spot a cash for crash fraud.
Mobile DJs and trainee footballers are UK’s riskiest drivers
Oct 27th
Mobile DJs (do they still exist?) and trainee footballers are officially the most difficult to insure professions according to some recent data published this week. The research shows the effect that occupations can have on car insurance premiums as it compares the UK’s most expensive professions with the cheapest. Not surprisingly, the huge number of night time motorway miles they drive helps to push the traveling DJ’s average premium to a whopping £6,810 a year. Not far behind is the trainee footballer whose youth and ability to afford a super car make him a serious risk, with an average premium of £6,624 a year (about 2 day’s pay).
As for the least expensive occupations there are no surprises. Bottom of the expense list comes the commercial airline pilot whose ability to land a 150 ton plane goes some way to reassuring the insurance companies into providing an average premium of just £321 a year. Alongside the pilot are slightly less well known professions. Being a “China Restorer” will get you a premium of just £336 a year, while if you call yourself a “Toy Maker” you’ll be looking at a premium of just under £338 a year.
Plan to raise speed limit divides opinion
Oct 13th
Unsurprisingly most motorists (59%) think the new 80mph motorwat speed limit would be a good idea, showing that the scheme would certainly benefit from public support if it was introduced.
14% of us would go even further than that and would like to see a speed limit in excess of 80mph (or no speed limit at all).
There is opposition however from road safety charities and campaigners. David Williams, chief executive at GEM Motoring Assist, said: “There are very obvious road safety implications including drivers having less time to react at higher speeds. Given the road safety record is currently heading in the wrong direction, this alone is a good enough reason not to raise the limit.”
Green campaigners too are raising objections, point at the inevitable increase in fuel consumption that would come with such a change. Britain currently has some of the safest roads and motorways in Europe, as well as a lower speed limit than most of the continent.
The maximum in France and Italy is 81mph, while in Ireland Spain and Portugal it is 75mph. German autobahns are unrestricted.
MIB report shows widespread uninsured driving
Sep 15th
The MIB (Motor Insurer’s Bureau not Men in Black) has released a report that throws some light in the extent of uninsured driving in the UK.
There are estimated to be around 1.5 million uninsured drivers (or about one in every 25 cars) on the roads of the UK every day but it seems that this ratio changes depending on where you live. The MIB report shows that in some areas the ratio may be as high as one in three!
The report points to Bordesley in Birmingham and some areas of Manchester and Essex as examples where up to one third of all cars do not have insurance. Around 160 people die in the UK every year as a result of unisured drivers so it’s a problem that the insurance industry and the police take very seriously.
The new compulsory off-road insurance legislation has been designed to help the authorities detect uninsured vehicles and is part of a series of measures recently introduced to clamp down on fraud and help to reduce insurance premiums.