Industry responds to whiplash reforms

Following the government’s decision to push ahead with a crackdown on whiplash claims the industry has issued its support of the reforms.

RMI Bodyshops (NAB and VBRA), the UK’s trade association for vehicle repairers, said it was ‘encouraged to see that the Ministry of Justice has launched a consultation on proposals which will reduce the unacceptably high number of whiplash claims, and allow insurers to cut premiums.’

RMI Bodyshop director, Jason Moseley commented, ‘We welcome the government’s commitment to tackle the whiplash epidemic. The reforms will crack down on minor, exaggerated and fraudulent claims.

‘We will be responding to the consultation, and seeking a meeting with government to outline our views.’

Adrian Furness, claims and operations director at Covéa Insurance, said, ’There has been a lot of debate about this, understandably, due to the many vested parties all purporting to represent the customer’s best interests. This news shows that having examined all the evidence, the government clearly agrees with us that the current system is dysfunctional, unfair and damaging to ordinary motorists.

‘We welcome the prospect of reforms which will reduce the cost of claims and lead to lower premiums, as well as reducing the misery caused by nuisance calls. Right to remediation for those who are genuinely injured will not be affected, conversely, they will receive a more responsive service as claims handlers will not be encumbered with the high proportion of fraudulent and inflated claims.’

Ian Hughes, chief executive of Consumer Intelligence said, ‘The first thing drivers should notice is a reduction in nuisance calls from predatory claims companies. The need to produce medical evidence means that whiplash claims are no longer an easy and profitable for the ‘no win, no fee’ market

‘Drivers would also be wise to shop around to test whether their insurer is indeed lowering their premium in line with promises. There have been false dawns before. Insurers promised to pass on the savings when the LASPO (Legal Aid Sentencing and Punishment of Offenders) reforms came in three years ago. But when those reforms didn’t deliver the reduction in claims that insurers expected, rates rose again and are up 13.5% in a single year.’

Matt Oliver, spokesperson for online comparison website, Car Insurance, said, We welcome any steps that make it harder for disingenuous claims to be made, while ensuring that honest claimants are supported and taken seriously. The measures outlined by the Ministry of Justice in its consultation should provide a more effective way of identifying have-a-go compensation chasers and reduce the volume and cost of these sorts of claims.

‘If, in future, insurers are able to only pay out for genuine claims, it will make a significant difference to all of our car insurance premiums.’

However, Ian Davies, partner at Kennedys also urged caution: ‘The news to proceed with the reforms to crackdown on whiplash claims will come as a significant boost to many insurers and a severe blow to many in the claimant market, who were no more than a month ago celebrating the reforms being seemingly shelved.

‘The short consultation period will place pressure on all concerned to evaluate the proposed measures and consider the impacts to their particular book of business.

‘The boundaries of the consultation appear to go further than previously proposed. Consequently, it is sure to generate a forceful response from all quarters. In particular, we anticipate an outcry from those who deal with injury claims outside of the whiplash space who will be affected by the proposal to increase the small claims limit for all personal injury claims.

‘What is clear from the statement is that the government remains determined to continue to tackle fraud and the compensation culture surrounding whiplash claims. What the government must also consider is the potential for unintended consequences.’