Tackling whiplash claim culture

What Blackburn people started, Prime Minister David Cameron will finish. That, at least, is how things look after last Tuesday’s “motor insurance summit” at Downing Street.

I am clear that Mr Cameron has got the message loud and clear that the interlinked rackets, and just-legal wheezes which have driven motor insurance premiums sky high – and out of reach for some – have to end.

The Bill I introduced into the Commons last September, with all-party support, had four key proposals:

  1. To ban “referral fees” – the average £600 which is paid by the personal injury lawyers (and ultimately by the insurer) to claims management companies, recovery and repair firms, the no-fault insurers, and (I’m afraid) to some police and NHS staff for accident details;
  2. To cut in half the fixed fee of £1,200 which these lawyers receive for each successful claim of less than £10,000;
  3. To restrict “whiplash” claims to those few where there’s been a real neck injury for which there is objective evidence; and
  4. To stop insurers from penalising honest motorists, especially in the North West, for the fact that claims management companies are more active here than elsewhere.

The Government are already legislating to ban referral fees – not in as strong terms as I think is necessary, but I’m not cavilling about that. They’ve promised to cut the fixed fee. On Tuesday I understand much of the discussion at the “summit” was about whiplash. It’s not in the bag yet, but I’m pretty certain that action on this will follow. It needs to. On the face of it, the statistics suggest that people in England and Wales have weaker necks than anywhere else – including Scotland, which is obvious nonsense. It’s because our system is far more lax in allowing spurious claims. I want to see new rules on whiplash – no compensation, without  good external evidence, if the crash speed was 15 mph or less; medical reports from doctors independent of the claimants.  

Action on my fourth point will take longer; but three of four is good progress.

Author: Jack Straw

Jack Straw was elected as the MP for Blackburn in 1979 and is currently the Secretary of State for Justice.

One thought on “Tackling whiplash claim culture”

  1. Jack Straw has done a good job on this. Without his interventions, the Government, and the Transport Select Committee, would not have focused as effectively on the key areas that need to be addressed. I believe an important issue to also look at further, however, is the need to bring claims management companies under tighter regulatory control especially with regard to curtailing their case-generating tactics. The referral fee ban is a good start to this process.

Leave a Reply

Your email address will not be published. Required fields are marked *