Accident numbers fall but whiplash claims still rise

| October 15, 2012
Accident numbers fall but whiplash claims still rise

The number of claims for compensation for a whiplash injury sustained in a motor accident has continued to increase despite a fall in accident numbers, the Institute and Faculty of Actuaries has revealed.

The Institute reported a 20 per cent drop in the number of injuries reported to the police in accidents between 2006 and 2011, but a 40 per cent increase in the number of third party injury claims.

The average small third-party injury claim over the last year was valued at £8,400, its report said.

The organisation suggests that claims management companies are partly responsible for the continuing growth in whiplash claims, which is costing the insurance industry around £400m.

The Institute, which looked at data from the motor insurance industry and the police, said that this cost had not been passed to consumers in the form of higher premiums.

David Brown, chairman of the Institute, said: “All of the updated data that we have collated supports the conclusion that claims management companies have had a marked effect on the number of small injury, whiplash-like claims.

“Despite [the cost], the average cost of a UK motor insurance policy is decreasing.

“This is good news for the consumer, but it does raise the question of how sustainable this is for insurers.”

Meanwhile, as part of its commitment to cutting red tape, the government is consulting on a proposal to allow motorists to purchase a car tax disc without having to produce their motor insurance certificate.

The Driver and Vehicle Licensing Agency’s records are now regularly compared with the Motor Insurance Database, allowing the registered keepers of non-insured vehicles to be identified.

Roads Minister Stephen Hammond said: “There is absolutely no benefit in making motorists prove they have insurance when they buy a tax disc now that we regularly check existing databases for insurance.

“These proposals will make the whole process quicker, easier and cheaper.”

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