18-fold increase in costs blamed on insurers themselves
UK motor insurers including Aviva, Admiral and Fortis have seen referral fees increase claims costs 18-fold, Bloomberg reports.
Bloomberg said: “Insurers offer customers involved in an accident that wasn’t their fault a replacement car and free legal advice. In return for directing these customers to law firms and to car- rental firms such as Helphire, the insurer typically receives from law firms and car rental firms a fee of up to 900 pounds.
“The aggressive pursuit of payouts by car-hire firms and lawyers from the insurer of the at-fault driver has bumped up claims across the industry, adding 10 percent to the cost of car insurance, or about 82 pounds ($136) a person, the Association of British Insurers said.”
The practice is attacked at length in the full article.
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