Which? report reveals insurers failing to pass on road traffic accident savings

11/10/2016

Consumer organisation, Which? has claimed that motor insurers are increasing driver’s premiums after a collision, despite the policy holder not being at fault.

The findings of the undercover investigation revealed that the cost of minor collisions are being passed on to policy holders, which is at odds with promises made by the insurance industry to reduce premiums after reforms were brought in to combat the number of whiplash claims.

The Law Society has spoken out about the report, saying it wants answers from the insurance industry.

It has suggested that, as a consequence of recent (the Jackson) reforms, the government’s objective to reduce the cost of motor insurance by reducing the number of personal injury claims was not being met because insurers are not passing the savings on. According to figures released by The Times, road traffic accident personal injury claims have fallen by 23,000, saving insurers almost £520 million.

In addition, the Law Society is also concerned that government plans to raise the non fault personal injury claims threshold from £1,000 to £5,000 will prevent access to justice for people claiming for soft tissue injuries. If the plans go ahead, it’s likely that those suffering from whiplash – perhaps the most common road traffic accident injury – won’t be able to get the legal advice they need to bring a claim because injuries of this nature tend to receive damages of less than the proposed £5,000 level.

As it’s a legal requirement for motorists to have insurance and declare any incident when renewing a policy, even if they failed to claim, the Law Society believes that motor insurance providers should not be financially benefitting from fewer road traffic accident claims by not passing on the savings to the public.