• Whiplash claims have risen by 50% over the last decade 
  • Ministers look at banning whiplash compensation or implementing a cap
  • LV= pledges to pass all savings from the measures on to customers

Tackling 'rampant compensation culture'

According to the government, the UK's roads are some of the safest in Europe and there has been a fall in the number of accidents over recent years. But LV='s research has revealed that the country is known as the 'whiplash capital of the world', with around eight in 10 (78%) of all personal injury claims estimated to be for whiplash (neck sprain or strain).

Justice Secretary Liz Truss puts it down to a 'rampant compensation culture', with whiplash claims seen as 'an easy payday', which is 'driving up costs for millions of law-abiding motorists'.

Getting tough with whiplash claims

A consultation paper was launched by the government this week, setting out plans to tackle exaggerated or fake whiplash claims by:

  • Scrapping the right to claim for compensation
  • Capping the maximum payout at £425 – down from £1,850
  • Ruling that all claims would need a medical report from a credited expert before any payment could be made
  • Increasing the small claims court limit for all cases of personal injury claim from £1,000 to £5,000
  • Clarifying the compensation payments tariff system for those with more serious injuries

Passing on all the savings

LV='s Claims Director Martin Milliner confirmed in March 2016 that we will pass on all savings to consumers. Our claims data from last year shows that 80% of all personal injury claims we received were related to whiplash, and at least 11% of our average car insurance premium can now be attributed to paying for whiplash claims – an unnecessary cost for our customers to bear. 

As Martin Milliner said in our statement, 'we welcome [the] consultation and look forward to working with the government on implementing the reforms. […] It's vital the government implements these proposals without delay to ensure consumers can start getting a fairer deal as soon as possible.'

A waste of money and time

It's not just insurance premiums that are being hit – honest motorists are paying for this through their time as well. Our research revealed that each Brit receives on average 468 nuisance calls every year, resulting in six and a half hours spent dodging them, listening to voice messages and deleting texts. Meanwhile, close to a million GP hours are being wasted every year dealing with suspected fraudulent whiplash injuries.

We've promised to pass on all savings from the 2015 Autumn Statement compensation crackdown to customers and that promise still stands. Honest motorists and businesses should not have to keep paying the price for unnecessary whiplash claims – it's therefore vital that government implements these proposals without delay so our customers can start getting a fairer deal as soon as possible.