Car insurance premiums could be reduced as compensation for whiplash claims is set to be cut.
Over the past 10 years, whiplash injury claims have increased by 50%, resulting in insurance companies paying out around £1bn every year. The government has proposed that whiplash claims could be banned, or capped at a maximum of £425 (as a point of reference, the current average payout on successful whiplash claims is £1,850). According to the government, insurers have pledged to pass on these savings to customers, which could result in a saving of £40 per year.
Putting a Stop to "Compensation Culture"
Justice Secretary Liz Truss said "For too long some have exploited a rampant compensation culture and seen whiplash claims an easy payday, driving up costs for millions of law-abiding motorists. […] These reforms will crack down on minor, exaggerated and fraudulent claims." Astonishingly, while road traffic accidents have fallen by almost 40% since 2000, the number of injury claims has increased by almost 90%. The Association of British Insurers has said that implementing the proposals would “give honest motorists a better deal”.
For more information on how whiplash claim reforms could benefit you, head over to the BBC website.
