Whiplash compensation news
18/02/2010

BIPI rise attributable to car crash fraud

The AA's motor insurance arm has said that a surge in fraudulent whiplash compensation claims has bumped up the cost of premiums.

The AA's claim follows the release of figures by the British Insurance Premium Index, which showed that the cost of car insurance rose by 7 percent during the fourth quarter of 2009, the biggest rise since records began in 1994.

Simon Douglas, the AA's director of insurance, said that, as well as fraudulent whiplash compensation claims, the dubious marketing tactics of some legal firms were to blame. "This is encouraged by personal injury claims lawyers, whose marketing urges people to make claims and whose costs, as well as compensation for the claim, are met by the third party insurer," he said.

However, Douglas made no suggestion that whiplash compensation should be denied to those people who suffer genuine injury in accidents caused by the negligence, inattention or reckless driving of third parties.

He also suggested that something would need to be done to arrest the rising cost of premiums.

"The situation is clearly unsustainable and the inevitable result is that premiums increase, despite the extremely competitive nature of the market," he said.

Despite this bleak outlook, there has been some good news recently, with a court in Manchester getting tough on car crash fraudsters.