Pain in the neck for insurance companies



There was a 5% increase in the proportion of accidents involving third-party injury (TPI) claims in England and Wales last year, according to the financial body.

"A total of 90% of the TPI claims made in 2012 were what we consider 'small claims' for less than £20,000," said David Brown, one of the authors of the IFoA report. "Coupled with the average claim figure of £9,512, this suggests that the majority of claims continue to be for whiplash-like injuries.

"The data we have collected for the last four years clearly shows a decrease in the number of accidents and you would expect that to correspond with a decrease in the number of TPI claims. Instead we have seen an increase in injury claims. This could mean that people are driving less safely. However police data shows that the number of motor accidents involving casualties has decreased. The other conclusion that you can draw is that claims farming is on the increase.

"Last year our report showed a clear correlation between claim 'hotspots' and the location of claims management companies.

"The proportion of claims for insured accidents involving bodily injury is higher in the UK than in the USA, which is generally considered the most litigious jurisdiction. Recently the Transport Select Committee suggested that the UK was the whiplash capital of the world, and they may well have a point."

The IFoA figures are based on analysis of third-party motor claims and look at data from around 95% of the UK motor insurance industry.