Report says personal injury claims have soared despite fall in number of road accidents

Houses of Parliament

The continuing explosion in personal injury claims was underlined last week by new figures in a heavyweight House of Commons report into motor insurance, which has recommended tougher tests for whiplash compensation.

The transport select committee report, published last week, highlights figures from the government’s Compensation Recovery Unit showing that 790,999 personal injury claims were recorded in 2010-11.

This represents a 17% increase on the previous year’s figure of 674,997, itself a hefty hike on the 625,072 registered by the Department of Work and Pensions unit in 2008-09.

The latest figures mean that the number of personal injury claims is now running at double the 395,735 average for 2000-05.

Injury claims rise, road casualty numbers fall

An Insurance Times investigation into whiplash last year uncovered figures showing that  of the total personal injury claims registered with the CRU in 2010-11, 571,111were for whiplash injuries – a 10% increase on the year before.

We must get away from the now-accepted consumer thinking that a minor car shunt equates to thousands of pounds in compensation.’

Tony Emms, Zurich






By contrast, CRU figures cited by the committee show that the number of road accident casualties has fallen by nearly a third from an average of 301,529 for the five years between 2000 and 2005 to 208, 648 in 2010.

The MPs recommend raising the bar to obtain compensation for whiplash injuries in order to stem the increase in personal injury costs.

They say that a diagnosis for the soft tissue injury, unsupported by any further evidence, should not be sufficient for a claim to be settled. GPs tend to rely on patients’ own reports of their symptoms when diagnosing the condition.

Legisation needed

The report also says that if government moves to clamp down on civil litigation costs fail to “significantly” cut the volume of whiplash claims, it should legislate to require claimants to supply objective evidence they have suffered an injury in order to secure a compensation pay-out.

Welcoming the report’s conclusions on whiplash, RSA UK and western Europe chief executive Adrian Brown called for a root and branch review of the payments for soft tissue injuries and the wider structure of personal injury legal fees.

He said: “We would urge the committee to ensure any whiplash reforms go far enough to address the volume of claims and the burden of proof.”

Zurich chief claims officer Tony Emms also welcomed the committee’s focus on whiplash. He said: “We need to consider as a society whether we continue with a justice system that compensates people for minor injuries on the basis of self reported symptoms with minimal medical proof, or whether that is a luxury we can no longer afford.”

“We must get away from the now-accepted consumer thinking that a minor car shunt equates to thousands of pounds in compensation.”

However elsewhere the MPs had harsh words for the insurance industry, criticising what they describe as “sharp practices”, such as referral fees.  

It said: “Collective leadership is required to turn back from some of the sharp practices of recent years. We look to the insurance industry to start showing this leadership.”

The committee’s other recommendations include:

  • A review of the ‘pre-action protocol’ and ‘online portal’, which was established to handle low-value personal injury insurance claims in 2010, to report in six months;
  • The publication of a plan on reducing the cost of motor insurance to be carried out by a cross-departmental ministerial committee;
  • Stricter penalties for breaches of the 2008 data protection legislation by insurance companies; and
  • An investigation into cold calling carried out to generate personal injury claims with a view to curtailing such activities.


Pass notes: Personal injury

What’s the state of play on the government’s drive to curb personal injury legal costs?
The Justice Bill, which implements the bulk of the Jackson Review’s recommendation on civil litigation costs, is currently under consideration by the House of Lords.

How is it likely to fare there?
The House of Lords is expected to give the legal costs package a much rougher ride than the House of Commons, where the government has more control.

Access to justice campaigners hope to persuade independent and Liberal Democrat MPs to water down the overall reforms via amendments to the legislation. The tone of debate in the Lords about the plans has already been more hostile than that in the lower house.

How much influence will the Transport Select Committee have?
Select committees cannot legislate, but they are in a strong position to put pressure on the government, which is obliged to formally respond to any recommendations.

How likely are its proposals on whiplash to be adopted?
It is notoriously difficult to develop an objective test for whiplash, because of the soft tissue nature of the injury, so getting a consensus from the legal and medical professions about the issue will be important.