Perpetually high numbers of personal injury claims have been an issue in the insurance industry for many years, and now represent half of overall claims costs according to general insurer Allianz.
Despite the fact that Britain has seen an overall drop in crashes on its roads, the number of injury claims has risen 50% since 2007.
Allianz estimate that for every £100 a UK insurer takes in motor premiums, £30 goes on advertising and other costs. The remaining £70 is used to pay claims, half of which goes to personal injury claimants. This compares to the German market, where just 4% of claims costs are the result of personal injury such as whiplash.
According to the Government’s Compensation Recovery Unit, personal injury claims rose by about 50% to 773,000 a year between 2007 and 2014, at a time when accidents reported to the police fell 23% and overall traffic rose slightly.
The Government is trying to discourage false claims. For example, the Information Commissioner’s clampdown on cold-call companies earlier in the year. Additionally, since April, all medical experts who assess whiplash injuries have been required to register with the Ministry of Justice.
More recently, solicitors have also been signing up to a new data-sharing site with insurers in a bid to tackle fraudulent claims.
Research predicts that insurers’ costs on car insurance will worsen next year, forcing providers across the industry to review their spending and, undoubtedly in some cases, premium levels.
If you manage a Fleet of vehicles within your company, you can mitigate some of your risks, with products such as Telematics, which offers real-time data on driving, which can be crucial as evidence in the case of differences in opinion about speed, breaking and positioning in the case of an accident.
Adapted from Article from Allianz