Despite a fall in the cost of premiums, tackling motor insurance fraud remains on the Government agenda according to the latest report on the subject by a committee of MPs.
“This is our fourth report on the cost of motor insurance, and while premiums are now falling, aspects of the market remain dysfunctional and have encouraged criminality to take root”, says Louise Ellman MP, Chair of the Transport Committee.
“Further action is still required to tackle fraud whilst protecting genuine claimants. The Government must prohibit insurers from settling whiplash claims before the claimant has undergone a medical examination.”
Ambulance-chasing law firms are the target of the committee’s wrath, with Ms Ellman adding, “Action is required to prevent abuses arising from Alternative Business Structures that allow solicitors to commission medical reports on whiplash and other soft tissue injuries from medical experts who are not genuinely independent. Solicitors must be banned from generating more work by offering inducements, such as cash or tablet computers, to encourage people to make a claim."
The report also endorsed the Government’s plan for courts to enforce the striking out of ‘dishonest’ insurance claims, but warned against the complex legal implications of bringing in hasty legislation. It also calls for the compulsory sharing of data regarding potentially fraudulent claims between insurers and solicitors, as well as pressing for the Solicitors Regulation Authority to prevent lawyers from commissioning unnecessary evaluations.
The committee urged the Government to ensure the police Insurance Fraud Enforcement Department, which is currently funded directly by insurers, is provided with funding long-term.
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