UK Insurance News

The current recession in the UK is partly to blame for a huge increase in the number of fraudulent insurance claims being made against motor insurance policies according to a report by insurer LV=, whose findings are supported by 40% of solicitors across the country.

But a more deep rooted problem can be found in the massive increase in compensation claims companies offering potential claimants the chance to sue with their ‘no win no fee’ advertisements.

Commonplace in the USA, there has been a massive growth in the last decade of companies offering this particular service in the UK, anyone unfortunate enough to watch daytime TV will have been bombarded with adverts for this service.

For many the temptation is obviously too great and some are even prepared to fake an injury for sometime in order to make a claim that they know is fraudulent.

The LV= report says that the most common ‘fake claim’ is whiplash, followed by post traumatic stress and strained muscles. One of the fake claims included someone making a car insurance claim even though they weren’t in the vehicle at the time of the alleged accident.

While another fraudulent claimant said she had been run over by a bus when she had only fallen off the side of the curb.

LV= claim that personal injury claims have pushed up the cost of the average car insurance by £100 per year to £300 and 60% of solicitors say that they have witnessed an increase in exaggerated injury claims over the past decade.

Almost ninety per cent of solicitors agree that the no win no fee system encourages people to make fraudulent claims.

LV= technical claims director Martin Milliner said;

“Genuine cases of personal injury where another person or company is at fault are certainly cause for compensation. However, drivers who invent or exaggerate their injuries to make a claim not only break the law but also push up the cost of car insurance premiums for all motorists.”