Personal injury shake-up could cut car insurance costs

Posted :14-12-2005

The cost of motor insurance may fall under radical new plans to reshape the personal injury claims system.

The Association of British Insurers (ABI) has called for an arbitration system to replace the court system currently used to resolve personal injury claims.

According to the ABI, this shake-up would "significantly" cut the £2 billion per year British insurers spend in legal fees – savings that would be passed on to the consumer.

As personal injury claims continue to drive up premium prices, this new system could cut out the 'middle man', and save both time and money.

Ian Crowder of the AA told the Telegraph: "These new proposals will aim to take personal injury claims out of court and take lawyers out of the loop altogether, thereby cutting costs significantly.

"There's no doubt that the soaring cost of personal injury claims has been a significant contributor to insurance premium inflation."

He added: "If they could be brought under control, premiums could be cut."

The ABI pointed out that the proposed reform would in no way cut compensation to genuine claimants, and plans to set about its proposals for the new system new week.


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