Compensation claims drive up higher premiums

Due to the amount of compensation claims being paid out to car accident victims, car insurance premiums have raised by 5.9 percent, almost three times the rate of inflation in the last year.

Car accident claims have increased by 10 percent every year, including the costs of traffic accident lawyers, earning them a significant amount of money and so claiming them the name of ambulance chasers.

The European New Car Assessment Programme was brought in, in the 1990’s to measure the safety of vehicles, according to their ability to minimise the effect of a head on or side collision. All new cars are given a star rating of 3 or 4 due to the best design and safety features, this now means that the likelihood of surviving a car crash in a new car is a lot higher, and lawyers are now using this to claim higher compensation for less serious injuries, such as whiplash.

At present it seems that the legal system is in favour of the lawyer and unless a method of sorting out claims is concocted then the amount of compensation payouts will increase, therefore raising our insurance premiums.

Estimated that every 40 pence out of every £1 in a claim is being paid to the lawyer, it is clear that the raising costs of our premiums is down to the legal system, and so a new way of handling claims needs to be identified without the need of so much legal intervention.

News Provided by Insuremyvehicle.co.uk

March 10^th 2008

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