Aviva, the UK’s largest insurer, has sparked controversy of late, with a call to ban whiplash payments for motor injury victims, in an effort to combat the country’s burgeoning ‘compensation culture’.
The proposed revision is expected to save Aviva an estimated £900million, with the insurer only remunerating rehabilitative treatment for whiplash claimants, as opposed to paying out financial compensation.
Yet this £900million sum equates to a saving of just £32 per policyholder per year – not even 10% of the average annual motor insurance premium of £358. With whiplash claims allegedly accounting for 94% of all motor insurance claims, one can draw the conclusion that the other 90% of the premium must, therefore, relate to the other 6% of claims.
Still with me? The Association of British Insurers reports that more than half of the cost of the average premium is spent on repairs, staffing and overheads. Perhaps then, Aviva should turn its attention to these areas for penny-pinching, rather than adjusting policies to the detriment of the policyholder.
In essence, car insurance is taken out in the hope that the motorist will never need to make a claim. However, should such a situation arise, the basis of the legal system in England and Wales states that, should a person suffer physical injury as the result of somebody else’s fault, they are entitled, by law, to be compensated for their pain and suffering.
Whether that is a minor, short-lived injury or a near fatality is not the point. All road traffic accidents are traumatic to a certain degree and evidence collated by the Association of Personal Injury Lawyers (APIL) shows that whiplash does not always fall into the ‘short-lived’ category.
One in five people with whiplash are reported to still display symptoms a year later and compensation can provide invaluable financial security at a time when other sources of income may be significantly impacted upon.
As such, Aviva’s suggestion to raise the claim threshold at which personal injury solicitors can get involved from £1,000 to £5,000 has been deemed completely ludicrous.
And rightly so.
Personal injury solicitors act on behalf of claimants ranging in age, from infants right through to those in their nineties and beyond. It is utterly incomprehensible to expect a child, for example, to conduct their own claims case without professional legal assistance, simply because it does not add up to £5,000.
In fact, a large proportion of road traffic accident injuries will have a treatment value far below the £5,000 mark, even those involving broken bones.
Whilst Aviva’s intentions may well be an effort to make improvements for policyholders, it appears that a marginal financial saving has been favoured in place of awarding justified settlements to legitimate claimants.