PROPOSED LEGAL CHANGES
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The government is considering proposals from the Transport Select Committee’s report into the cost of motor insurance, published 11 March. The government response is expected in May as it must respond within two months. The Select Committee has noted concerns raised by Lord Justice Jackson in his report last year.
The committee’s findings include: ● Premiums have risen because of the increased number of personal injury claims from road accidents. Premiums must now pay for personal injuries and legal costs on a much greater scale than before. This situation may lead to fraudulent claims for non-existent or pre-existing injuries.
● The industry and the government should do more to tackle fraud.
● Insurers should be able to gain access to DVLA information about their customers.
● Referral arrangements where fees are paid to insurers, solicitors, claims management firms and others should be transparent (the Jackson Report wants them capped or banned).
● Proposals for consultation should be published within six months with a view to legislation within this parliament.
At the same time, the government is considering the Jackson report, which looks at the whole insurance sector and calls for the setting up of a Costs Council to review fixed costs and lawyers hourly rates.
In its submission to the Select Committee last November, the Road Haulage Association said that HGV motor insurance is working well with annual increases averaging 2.9%. However, it added that “excess charges are weighted heavily against young HGV drivers and industry needs to work around that to attract more young recruits... Contacts in the insurance industry tell us that excess charges for drivers under 25 can be doubled or trebled.” ● More information: www.2BEeurope.com; http://bit.ly/gF01hv