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Liverpool remains the personal injury claims capital of the UK for road accidents

  • 55% of road accidents in Liverpool result in a personal injury claim;
  • North-west continues to have the highest third party injury to third party property damage ratio in the UK;
  • Personal Injury Claims Management Companies’ turnover increased 30% to £310m in the year to March 2015

The Institute and Faculty of Actuaries’ (IFoA) annual report looking at third party injury (TPI) and third party damage (TPD) motor insurance claims shows Liverpool remains the third party personal injury claims capital of the UK, with 55% of road accidents resulting in a claim.  This compares to a national rate of just over 30%.  The IFoA report collated and analysed data from 18 of the top 20 motor insurers for 2014. The report focussed on third party claims which make up 70% of all motor insurance claim costs.

Main findings of the report include:

Despite material reductions across the whole of the country in the frequency and costs of claims following the new LASPO* legislation in 2013, frequencies and costs are on the rise again – part of which may be attributed to the action of claims management companies (CMCs).  The impact on insurance costs will be highest where there are the highest percentages of personal injury claiming, with cities such as Liverpool expected to see larger increases in insurance premiums.

The highest concentration of CMCs in 2014 remained the North West, followed by London, the South  East and the West Midlands.  Correspondingly, the report also found that North West England has the highest third party injury to third party property damage ratio and the South East has the highest frequency of third party property damage claims. 

Scotland and the West Country have both the lowest third party property damage and third party injury to property damage ratios.
Despite the number of Personal Injury CMCs dropping by 13% to 979 over the year, turnover for the sector increased in the year to March 2015 by 30% to £310m. 

For the whole of the UK, the percentage of accidents involving a third party personal injury claim increased by 1.5% in the 12 months to the end of 2014.  This followed a reduction of some 5.1% following the introduction of the LASPO legislation (2013 accidents compared to 2012).  Somewhat surprisingly, despite having a much higher proportion of third party injury claims than the rest of the UK, Liverpool did not benefit from any greater reduction in the percentage of claims being filed than the rest of the UK with the introduction of LASPO.

David Brown, one of the authors of the IFoA report said:

“The IFoA report finds that despite a significant drop in the overall number of authorised claims management companies since Government reforms were put in place in April 2013, it appears that in regions where there is a large number of claims management companies, there is also a correspondingly high proportion of third party personal injury claims being filed compared to property damage claims; and the reforms have not changed this.

 “The impact of recent claims inflation will be greatest in those areas of the country with the most claims.  And this will mean that pressure to increase premiums will be greatest there too – and here I fear that Liverpool is front of the queue.

“The Government is aware there is a case for further reform of the industry.  The Government is due to review the regulation of Claims Management Companies in early 2016.  CMCs currently make it much easier for claimants in cities like Liverpool to make claims as they assist individuals in making claims for items such as compensation and provide access to solicitors.  We fully expect the Government review to consider how the rights of claimants stack up against the desire, for example, of Liverpool motorists for lower insurance premiums.

“It appears that the legislation implemented so far has failed to be hard hitting in areas with a high third party injury to third party property damage ratio such as the North West.  The Transport Select Committee previously suggested that the UK was the whiplash capital of the world.  It remains to be seen if this, and Liverpool’s pole position here, will ever change.”

*LASPO: Legal Aid, Sentencing and Punishment of Offenders Act (in force since 1 April 2013). LASPO introduced a number of measures that impacted TPI claims, including the banning of referral fees that were formally used to encourage claim filing and reductions to the third party legal costs which can be recovered as part of the TPI claim.



Annette Heninger, Media Relations Manager
Tel: 07525 592 198

Editorial notes:

Download a copy of the report.
The TPI to TPPD ratios by region are shown below.

North West 43%
North East 33%
South East 30%
Midlands 32%
Wales 30%
East 26%
West 24%
Scotland 20%

About the Institute and Faculty of Actuaries

The Institute and Faculty of Actuaries (IFoA) is a royal chartered, not-for-profit, professional body.

Research undertaken by the IFoA is not commercial.  As a learned society, research helps us to fulfil our royal charter requirements to further actuarial science and serve the public interest. 

Actuaries provide commercial, financial and prudential advice on the management of a business’s assets and liabilities, especially where long term management and planning are critical to the success of any business venture. They also advise individuals, and advise on social and public interest issues.

Members of the IFoA have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyd’s.

Members are governed by the Institute and Faculty of Actuaries. A rigorous examination system is supported by a programme of continuing professional development and a professional code of conduct supports high standards reflecting the significant role of actuaries in society.

The IFoA is available to provide independent expert comment to the media on a range of actuarial- related issues, including enterprise risk management, finance and investment, general insurance, health and care, life assurance, mortality, and pensions.