Law Society chief calls
for full investigation into motor insurance industry
practices
The Law Society's chief
executive Desmond Hudson has said that the insurance industry is
increasing motor insurance premiums and has called for a full
investigation into insurers' practices.
The call comes after MPs raised
concerns over the rise in whiplash claims.
Law Society chief executive
Desmond Hudson said: “The insurance industry has many
questions to answer for any unjustified rise in whiplash
cases. The motor insurance industry is profiting from
providing what is in effect a public service, as it is a
legal requirement to have motor insurance.
“It is up to insurers to
fight cases that they feel are inappropriate. If the insurance
industry simply pays out when it sees the word
“whiplash” whether the case is justifiable or not is it
any wonder these claims are rising?
'Many will take the view that it
is too easy for insurers simply to pay the claims and add the costs
to the premiums. The courts have historically taken a pragmatic and
appropriate view in ensuring that compensation does not
overstep the bounds of reasonableness. The industry should
find the appropriate cases to establish the boundaries.
“The issue of whiplash is
not an isolated case. What are insurers doing to stop the racket of
inflated courtesy car hire charges whilst selling claimants
details?
“The reality is that the
insurance industry itself is fuelling the costs of accidents and
passing them back to motorists. The fact that it sells
accident details to third parties inevitably fuels the number of
claims. Some firms have a record of seeking to pay off the
victim of an accident whether or not that victim has been
injured.
'There needs to be a full
investigation of the industry's practices. It needs to put its own
house in order before pointing the finger at
others.
“Above all, however, it
needs to be remembered that for many accident victims whiplash can
be a painful and debilitating injury. Claimants who seriously
suffer from it are entitled to compensation and the Government
should not make it more difficult to claim that compensation just
because the insurance industry has failed to sort itself
out.
'We are happy to work with the
Government and the insurers to address these
issues.”
Ends
Contact: Steve Rudaini, The Law
Society
+44 (0)20 7316
5624