20 October 2011
The research shows that these claims hotspot areas match areas with the highest concentration and activity of claims management companies. In general, more claims management companies means more personal injury claims.
Conversely, Scotland has the lowest proportion of private motor insurance claims involving injury to third parties, with 20% of claims in the Central Belt involving a claim for injury against a UK average of 29%. Scotland has stricter controls on referral fees, with the amounts paid being less than the rest of mainland UK, and so has far lower numbers of claims management companies operating
David Brown, one of the authors of the research, said:
“Claims management companies in England and Wales make money from referral fees; they sell on the details of the case to a solicitor, for example, and receive a fee for this. At present, there is no regulation of referral fees although the Ministry of Justice is currently seeking to ban them.
“Our figures show the real picture of bodily injury claims in the UK and the regional differences are stark. The areas of the strongest growth for claims management companies; North West England, North East England and West London are all areas where the number of car insurance claims involving bodily injury claims are above the UK average.
“It is, of course, right and proper that those who have suffered bodily injury are able to claim compensation, but with claims management companies’ turnover rising by 50% to £377million in 2010, this is clearly a big money industry. We welcome the announcement from the Ministry of Justice proposing to ban referral fees and we will work with them, and others, in order to try and restore sense to the claims system.”
A copy of the report can be found here.
ENDS
Enquiries: Tel. Michael Scanlan on 020 7632 1453 or email michael.scanlan@actuaries.org.uk
Notes for editors:
| Region | % of private car insurance claims involving bodily injury |
|---|---|
| North-West England | 42.8% |
| Nevada (highest ratio in the US) | 40.3% |
| North-East England | 37.4% |
| Yorkshire | 33.5% |
| Central | 30.5% |
| London + South-East England (excl. Kent and Essex) | 29.5% |
| UK average | 29.4% |
| Wales | 28.3% |
| East Anglia | 25.8% |
| Borders | 23.1% |
| West and South-West England | 22.4% |
| Kent and Essex (excl. M25) | 21.8% |
| Central Scotland | 20.4% |
| Northern Scotland | 13.0% |
- The regional breakdown is done by ITV regions and are for year ending 31 December 2010
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