Ever increasing premiums for motor insurance are pushing hard pressed motorists to their limits financially, but finally there may be a glimmer of light at the end of the tunnel. A committee of cross party MP’s are challenging the industry to try and get them to reduce their prices.
The committee has said that the prices of car cover have spiralled out of control due to the increasing volume of claims for whiplash injuries. It has accused lawyers and insurers of cashing in on the trauma of accident victims by charging fat fees simply for passing on their names to companies who specialise in claims.
MP Louise Ellman is the chairwoman of the Transport Committee, and she says that solicitors, insurers and claim companies are the ones who have driven up the costs of car insurance. She is demanding that these charges be made more transparent and that customers are given clear and concise information on the referral fees and who is benefitting from them.
This has inevitably led to a lot of finger pointing between the legal and insurance industries, with each trying to blame the other for the ever increasing prices. The CE of the Law Society, Desmond Hudson, says the it is the insurance industry that is fuelling the costs of accidents and then passing it on to their customers, and some companies are known to pay compensation to claimants without checking if they were actually injured.
John Spencer, the director of Spencers solicitors, has said that insurers are often making offers without asking for medical evidence. Their aim is to buy off claims before the injured party seeks independent advice and receives proper representation.
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