Fraudulent Claims for Car Accident

The spiralling cost of car insurance is due to "sharp practice and poor management", according to a committee of MPs.
Uncontested claims for whiplash and a "merry-go-round" of referral fees are blamed for rising at more than twice the rate of inflation.

The MP's said insurers, solicitors and claims management companies have "driven up" the cost of motor premiums by encouraging people caught up in road accidents to claim for personal injury, car hire, and other legal costs.

Many of these claims are for whiplash, an injury where diagnosis is often subjective and therefore very costly for insurers to challenge.

Government figures show the number of road accident casualties has fallen by more than a quarter in six years, but personal injury claims have risen by more than two thirds.

And while the number of accidents on Britain's roads has fallen every year since 2005, the cost of car insurance has risen by 20% in the last two years alone.

The transport committee says the Government should impose a higher threshold for the payment of any compensation in whiplash cases, and should improve the management of car accident claims.

It's got to the point where a lot of young person's insurance is more than the value of their car.