The Association of British Insurers (ABI) has urged the government to increase the small claims limit from £1,000-£5,000 once more in order to, as they claim, ensure that the fall in motor insurance premiums can be sustained.
Speaking at yesterdays ABI seminar, Head of Motor and Liability, James Dalton claimed that a move to increase the limit would be a crucial step in ridding the profession of fraudulent and exaggerated claims on low value claims such as whiplash.
He said: “A simple, cost effective compensation system is crucial to ensuring competitive motor insurance premiums. One year on from the introduction of the government’s much-needed reforms of civil litigation, insurers are delivering on their commitment to reducing insurance premiums with the average, comprehensive motor premium having fallen 14% since the start of 2012.
“But more needs to be done. The glaring omission from this program of reform is raising the small claims limit to £5,000 to ensure that lower average motor premiums can be sustained. If consumers are to continue to insurer reductions in the cost of their car insurance, the government needs to act now. The ball is in its court.”
There hasn’t been a full response from the claimant industry to Mr Dalton’s claims, although Motor Accident Solicitors Society (MASS) did hint through their twitter account that more could be done by the insurance industry themselves to bring down premium costs.
On their official twitter account it read: “Savings to insurers are over £2.85 billion, so premiums should be down over 30%. Pass the Savings to customers now.”
So are insurers holding back the savings they are actually making? Well, it certainly would come as no shock as it is perceived that the real motivation behind their desperation to secure wide-scale reform to the personal injury industry is to line their own pockets.
But there is reason for the personal injury sector to be concerned with the ABI‘s rising campaign for more reform, especially considering the comments at the same seminar from a leading Ministry of Justice official.
The government made the decision not to increase the small claims limit last year on the basis of the findings by their own Transport Select Committee, which revealed that the insurers were using dated figures as the foundation for their appeals.
The claimant industry will hope that those facts are not forgotten as further, high impact reform to the industry could be devastating to the small claims industry as a whole and more importantly for the genuine claimant, who without legal representation is left facing a very one sided battle to get the compensation they deserve for their injuries.
1. ABI; https://www.abi.org.uk/