The call comes as Parliament prepares to debate the Civil Liability Bill (24 April), which contains controversial measures to reform personal injury compensation by limiting injured peoples’ legal rights. (i)
Access to Justice (A2J), which is campaigning against the government’s whiplash reform proposals, commissioned leading economics consultancy Capital Economics (CE) (ii) to explore how data gathering could be made more transparent.
A2J spokesperson Andrew Twambley said: “Only 20% of the public think insurers are trustworthy, yet the statistics insurers provide, for example on car insurance prices, or the level of insurance fraud, are often accepted at face value by policymakers.”
“Motor insurance is a compulsory purchase that costs households £14bn each year, or £515 per household (iii). It is only right that, when ministers propose to make controversial changes to the law on compensation payouts for road traffic accidents, the data set they use to justify the reforms is authentic, impartial and trustworthy.”
Motor insurance costs per household are on a par with gas bills (£525 per household) and more expensive than water (£385).
The CE report’s authors state: “Given the compulsory nature of motor insurance, we believe that there is a strong public benefit argument for improving the transparency, independence, timeliness and public availability of data on motor insurance. Independently produced data may assist in ensuring that the interests of motor policy holders are represented.”
Mr Twambley said that, when the Transport Select Committee held an inquiry into the cost of motor insurance in 203/14, it called on the government to “press the ABI to provide better data about fraudulent or exaggerated personal injury claims, so that there is a stronger evidence base for policy decisions.” (iv)
Mr Twambley said: “Ministers say these reforms are needed because insurers tell them there is a fraud epidemic, yet those same insurers say they pay out 99% of claims and the government’s data shows that whiplash claims have fallen rapidly in the last twelve months, by more than 10%.”
“Putting motor insurance data in the hands of the ONS will ease widespread concerns that motor insurance industry data may not be used in the public interest and also help the industry to resolve its longstanding ‘trust’ problem with the general public,” he added.
(i) The Civil Liability Bill will have its second reading in the House of Lords on 24 April
(ii) Capital Economics – Boosting Insurers’ Profits, an updated analysis of the impact of the United Kingdom government’s proposed whiplash reforms. April 2018. Copies of the report can be downloaded here: [add download]
(iii) Source: Capital Economics and Office for National Statistics
(iv) Transport Select Committee report cost of Motor Insurance, Whiplash 2013
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