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Whiplash claims have surged to near-record levels, costing insurers £2.5bn a year and – because they like to share the pain – typically adding £93 to YOUR annual motor insurance premium.

Now, a proportion of that cost is made up of fully justified claims from people who’ve been injured in a road traffic accident. The problem is that a lot of it represents exaggerated or wholly fictitious claims from individual opportunists and organized criminal gangs. And whiplash is a growing problem, despite the fact we’re generally driving safer cars and having fewer accidents than in previous years. So just what is going on? And what can be done to chop as much as possible of that amount being added to your premium?

Whiplash – a growing problem

The UK is on track to submit more than 840,000 motor injury claims for the year ending April 2015 – that’s 2,300 claims every day. It’s also an increase of 9% on the previous year, or 200 extra claims a day. Statistics from insurer Aviva confirm the rising trend. It analysed the motor injury claims it received in 2014 and found that 80% included whiplash, a much higher figure than in many other European countries. In France, for example, whiplash claims account for about 3% of personal injury claims.

Sticking your neck out

So do UK motorists have weak necks, or is there another explanation for the high incidence of claims? Many experts blame Britain’s compensation culture. If you are involved in a car accident, it’s pretty easy to lodge a claim for whiplash. It’s even easier if a claims management company or personal injury lawyer submits the paperwork on your behalf – and 96% of Aviva’ personal injury claims last year were brought by third parties.

Tissue of lies

Whiplash is a popular target for fraudsters, too, It’s tricky to diagnose because it causes damage to the soft tissue. In other words, there are no visible signs, such as cuts and bruises. And it doesn’t show up on an x-ray. Bogus and exaggerated claims are therefore a big problem. Some firms estimate that fraudsters add £60 to the cost of every car insurance premium. The government has already introduced a series of measures to try to curb our compensation culture. It has, for example, imposed a ban on referral fees paid by claims firms, insurers and lawyers – money that changed hands in exchange for the names of those involved in accidents.

Panel beaters

It has also cut from £1,200 to £500 the fees lawyers can charge insurers for processing basic, uncontested claims for compensation for minor injuries suffered in road accidents.

That’s not all. From April 1, anyone attempting to claim compensation for whiplash following a car accident will have to get a medical report from a member of an independent panel of experts, known as MedCo. Practitioners who want to join the panel will have to gain special accreditation and be independent of any claims company. The reform package led to a drop in the number and cost of whiplash claims, at least at first, and motor premiums also fell. However, as injury claims have started to creep up again, so too have premiums.

Time and motion

Some firms are therefore calling for further changes. Aviva, for example, wants the time limit on claims to come down from three years to one year. It also suggests that the claimant’s symptoms should last longer than three months to qualify for a pay-out. Many insurers would also prefer to pay for treatment of minor soft tissue injury, rather than cash compensation, to discourage fraudsters. Of course, there’s a fine line between cracking down on opportunists and punishing genuine claimants. Can insurers walk that line? Aviva boss Maurice Tulloch says: “We are here to help our customers when they need it, and pay genuine claims quickly. “But we must address how to best treat the excessive number of fraudulent, exaggerated and minor whiplash claims that are driving up the cost of insurance.”

Health and efficiency

As well as being the enemy of honest motorists, whiplash fraudsters are adding an estimated £60 to the cost of every car insurance premium. But they also place a heavy burden on our NHS, according to another insurer study, this time by LV. It calculates that bogus claims waste close to one million GP hours every year – time that could be better spent with genuine patients. Doctors now see a total of 116,000 cases a month where they suspect the ‘patient’ is feigning or exaggerating a whiplash injury in order to claim compensation. Dealing with fraudsters not only takes away valuable appointment time from genuine patients, but also additional surgery hours dealing with law firms and claims companies.

Aches and strains

The strain on the NHS is clear – and it’s getting bigger. More than 40% of doctors see suspicious cases on a frequent basis, compared to just 26% in 2012. And nearly a third (29%) of doctors are witnessing a wider variety of injuries linked to compensation claims than they were three years ago. LV’s claims data also shows there is a growing number of suspicious cases where compensation is sought for head, back and psychological injuries. In other words, post-traumatic disorders in the wake of an accident. Martin Milliner, claims director of LV, says: “Verifying personal injury claims takes up a lot of time and places unnecessary pressure on our already stretched health service. The cost of dealing with fraudulent claims not only pushes up the cost of car insurance for honest motorists but it also hurts the public purse.”

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