Britain is the ‘whiplash capital of world’

The UK’s civil litigation system and wider compensation culture has led to a steep rise in road accident whiplash injury claims in recent years, the Association of British Insurers (ABI) has told the House of Commons Transport Committee.

The motor insurance industry paid out £10.7 billion in claims in 2011, of which whiplash claims cost approximately £2.2bn, (the equivalent of over £6 million a day) said the ABI in written evidence to the committee.

The ABI said that while there were a number of factors that affected the price of a premium, and individual insurers priced their policies differently, the cost of claims was highly indicative of the overall level of premium that an average motorist could expect to pay.

It added that the average paid premium in 2011 was £440.

With whiplash making up 20 per cent of overall claims expenditure, this represents approximately £90 of the average premium.

The ABI, which was giving evidence to the committee yesterday, said in its written evidence: “Aggressive marketing by claims management companies and referral fees paid by claimant solicitors (banned from 1 April this year), have led to an increasing number of personal injury claims in general, and whiplash claims specifically.”

Answering in its written evidence the question: “Is it correct in describing Great Britain as the ‘whiplash capital of the world?’” the ABI replied: “Yes”.

It went on: “Although the lack of an objective test for minor whiplash injuries is an international problem, it is the UK’s civil litigation system and wider compensation culture which has led to the steep rise in whiplash claims in recent years.”

The ABI added that little had changed since 2004, when Europe-wide research showed that the UK had twice the average percentage of whiplash claims as a proportion of personal injury claims compared with the European average.

It added that latest figures show “the UK [78 per cent] still has a substantially higher than average percentage of whiplash claims as a proportion of personal injury claims, than our EU counterparts [48 per cent]”.

Among the many groups that have also submitted written evidence on whiplash to the committee is the Association of Personal Injury Lawyers (APIL), which is also due to present oral evidence to MPs today.

The APIL, when asked whether Britain was the world’s whiplash capital, replied: “The government’s only source for this assertion appears to be a report from the Comité Européen des Assurances, which is nine years old.

“The assertion that Britain leads the world in whiplash claims has been made popular by the insurance industry, in its efforts to restrict these claims.”