Recent growth has been seen in the litigation market in the field of allegations of fraud in road traffic accident cases. Insurers (particularly certain insurers) have latterly been far more confident in fighting claims where there is good evidence of something untoward: dishonesty, such as contrived accidents, phantom passengers or exaggerated medical symptoms.
This strategy appears to be working. Miles Costello in The Times' Business Section reported yesterday that an analysis by EY of Britain's motor insurers annual profits to March 2014, shows they paid out less in claims than they received in premiums for the fist time since 1994. The article however quite properly cites other reasons for this, such as the ban on referral fees and restructuring of the fees recoverable under "new" CFAs. The knock-on effect has been felt by the motorist - this time in a good way - with a 16.6 per cent drop in premiums over the last year to March.
It would be interesting to see if this trend continues. Certainly as the new costs provisions become the norm, it is likely to. The effect of allegedly to be tighter "rules" for diagnosing whiplash injuries (if brought in) are likely to reinforce it as are bans on "distasteful" advertising and incentives such as free tablet computers and cash advances promised to potential claimants.