Latest data from the Institute and Faculty of Actuaries show a “marked discrepancy” between official road accident injury figures since 2006 and the number of injury claims made to insurers.
During the period road accidents involving injuries fell 20%, according to Police records, while the Institute’s figures show a 40% rise in third party injury (TPI) claims, with hotspots for TPI claims across postcodes in Birmingham, Manchester and Liverpool.
According to the professional body, the locations correspond with those of claims management companies.
The report also puts the average size of a small TPI claim at £8,400, indicating that the majority of claims are for whiplash like injuries.
David Brown, chairman of the Institute and Faculty of Actuaries UK third party motor and PPO claims working parties, comments: “All of the updated data that we have collated supports the conclusion that claims management companies have had a marked effect on the number of small injury, whiplash like, claims.”
Further key findings include:
There has been a 5% decline in the number of authorised claims management companies, although their income rose by 21% to £455 million in 2011. (Source for income: Ministry of Justice annual claims regulation report).
There was a 19% increase in TPI claim costs in 2011 which led to an estimated £400 million increase in costs to insurers.
Despite this increase insurers appear not to have passed on this cost to consumers – the average cost of UK motor insurance premiums has fallen by 7.1% over the last 12 months (source: Confused.com/Tower Watson Car Insurance Price Index July 2012).
Category: Car Insurance News, Insurance News, Legal News
