Cut the cost of car insurance by banning referral fees, say MPs
Thursday, 12 January 2012 10:08
A group of MPs has called for tighter measures to be put in place to control the number of personal injury compensation claims made for road accidents.
The Transport Select Committee said people who say they have suffered whiplash should be made to prove it, while insurers should be banned from selling people's details to third parties.
Chairwoman Louise Ellman said insurers and claims management firms have pushed up car insurance prices for motorists by encouraging them to make claims, even though the number of accidents taking place on Britain's roads has decreased.
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Nick Starling, director-general of the Association of British Insurers, welcomed the fact that the MPs have recognised some of the reasons why premiums have been pushed up so much.
He also praised the suggestions regarding whiplash and a potential review on lawyers' fees.
"We are baffled though that the Transport Select Committee has again called for the transparency of referral fee arrangements of insurers.
"Referral fees should be banned altogether and not made more transparent - and that ban should apply to all organisations receiving them, not just insurers," Mr Starling commented.
Meanwhile, Simon Douglas from the AA called the Transport Committee's measures "a positive step" towards killing the compensation culture becoming prevalent in the UK.
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