Axa said that it will no longer accept referral fees from personal injury lawyers and has called for whiplash injury reform to eliminate fraud within the industry.
Axa said that it has been a vocal supporter of the reforms proposed by Lord Justice Jackson, calling on a number of occasions for their early adoption and highlighting the impact that “compensation culture” has had on motor insurance premiums.
It said that of particular concern is the unscrupulous practice of motorists being encouraged to make claims several years after an accident when it is almost impossible to verify what injury has been sustained, particularly when no injury was claimed at the time of the accident.
Axa said that it has never sold customer details to personal injury lawyers or accident management companies, and with immediate effect will no longer accept fees from personal injury lawyers when we put our customers in contact with them to pursue valid claims notified at the time of an accident.
It said it estimates that around half of the recent increases in motor insurance premiums is related to the rise in bodily injury claims and hopes this action is a first step in a journey to reform the emerging compensation culture which is spiralling out of control and encourages government to ban referral fees completely.
It added that what is ultimately needed, however, is a fundamental evaluation of whiplash and other minor trauma claims to eliminate fraud and bring some sense back to the cost of these claims.
Axa said: “Other countries have banned whiplash claims either totally or below a certain speed threshold and, while our industry needs to properly compensate those who have suffered injury, we call on the government to bring about changes that will have the effect of limiting this exponential rise in spurious claims.”
Paul Evans, group CEO, Axa UK, said: “As one of the leading insurance providers, we have decided that the only way to address the problem adequately is to lead by example. Over the last few years we have seen an exponential rise in personal injury claims – especially soft tissue injuries – whilst evidence suggests road accidents are decreasing. We have also seen a significant rise in claims made some years after the event which are therefore impossible to prove or to defend.
“It is unfair and unsustainable that drivers are being disadvantaged by exaggerated injury claims which drive up the cost of insurance. Referral fees have only served to promote an even greater number of injury claims and Axa will stop this practice whilst Government implements the necessary legislation to restore order. I believe this move will be a positive first step in making the system more equitable and, ultimately, benefit customers through more affordable motor premiums”.
Medico-Legal News Source: PostOnline
