Motor insurance industry must be placed under greater regulatory scrutiny to ensure it treats vulnerable people fairly, Thompsons Solicitors advises parliamentary committee21 November 2016
Thompsons Solicitors has submitted its argument to the upcoming enquiry
Next spring, the National Audit Office (NAO) is to complete its study into how vulnerable people are treated by regulated industries. Thompsons Solicitors has submitted its views to the enquiry, specifically focusing on how drivers and people injured in car accidents are affected by the behaviour of motor insurers.
Thompsons argues that insurers’ behaviour towards victims of accidents actively targets their vulnerability during the claims process and that reforms planned by the insurance industry and by the government will only make this situation worse.
On the 17 November, the government announced plans to raise the small claims limit under false claims of a ‘whiplash epidemic’ and strip the injured of their right to free, independent legal representation. Under the unprecedented plans, the financial burden of an injury would be placed on the innocent victim, not the person or organisation responsible for the injury for the first time.
Tom Jones, head of policy at Thompsons Solicitors, said: “It is clear to most that someone injured, perhaps very seriously, in a motor accident or at work that was not their fault is ‘vulnerable’. However, the sad fact is that motor insurers and government are now actively seeking to remove their right to gain access to justice and receive fair compensation for their injuries, meaning a huge number of people will be left to fight powerful insurers alone without any expert legal advice on their own, in their own time.
“This industry should not be taking advantage of that vulnerability to try and settle claims early with low-ball offers and then restrict the injured person’s ability to access expert, independent, legal support to fight for a fair outcome.
“An industry that sells a compulsory purchase product should be expected to be held to account by a strong independent regulator, however, the privileged few at the top of industry are largely left to their own devices, seeing premiums rise for consumers and eye-wateringly high remuneration packages for themselves.
“Meanwhile they are working hand in glove with the government to swing the law even further in their favour. Association of British Insurers figures show that, from 2010 to 2015, government reforms have given the insurers an £8.67bn windfall.
“It has also been found that policy holders living in areas with greater levels of ethnic diversity are paying more for their car insurance as a result of that ethnic diversity.
“There are a number of ways in which the insurance industry is producing bad outcomes for vulnerable people in the UK and also pressing the government to make changes that will make this much worse.
“We strongly recommend that the motor insurance industry is placed under much more rigorous scrutiny to protect all consumers.”
You can read Thompsons Solicitors’ full response to the NAO study here.
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