Chancellor of the Exchequer George Osborne committed to accelerating motor injury reforms in the Autumn Statement, expected to remove more than £1bn from the cost of providing motor insurance. Osborne said “We’re going to bring forward reforms to the compensation culture around minor motor accident injuries. This will remove [more than] £1bn from the cost of providing motor insurance”.
According to the Autumn Statement, the government will introduce measures to end the right to cash compensation for minor whiplash injuries, with consultation on the details in the New Year. It stated:
“Whiplash claims cost the country £2bn a year, an average of £90 per motor insurance policy, which is out of all proportion to any genuine injury suffered.” Backhouse Insurance Brokers Managing Director, Peter Barnes, said we welcome anything that will reduce third party costs which will subsequently reduce our client costs. We look forward to more detail and implementation.
British Insurance Brokers Association CEO Steve White also praised the move, saying the measures would lead to fairer premiums. “The Chancellor’s confirmation that he is ending the right to cash compensation for whiplash injuries and increasing the upper limit for claims in the small claims court to £5,000 is exactly what we wanted”, White said.