Knock-on effects from fraudulent compensation claims
Despite car safety measures in the UK increasing for several years, there has been a substantial increase in the number of drivers who are making compensation claims after apparently suffering personal injury in a car accident.
The EMB, which is a leading insurance consultancy, has reported to the House of Commons' Transport Select Committee, after finding evidence showing that car accident claims are behind the increased cost of premiums which could rise by up to 40% in 2011.
The consultancy said it appeared that fraudulent claims may be behind the rise in premiums and the MPs' committee is proposing that the police now need to be involved in order to combat this problem.
Another factor in insurance companies' costs is believed to be the activities of some accident management companies which take over crash cases and charge insurance firms for a range of expenses, such as referral payments, car hire and doctors fees – all of which add up to larger bills for the driver.
EMB analysed data from almost every insurance company in Britain has to check into which claims involved those who had suffered pain and loss of earnings in a road traffic accident.
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