Standing up for Customers

Adrian Furness discusses how the whiplash reforms ultimately have the customer at the heart


"Adrian Furness, Claims Director for Covéa InsuranceI’m concerned that as the debate about the latest whiplash reforms gets louder (I’m being polite), the most important person in the process is being forgotten - the customer.

Just taking the facts, the risk of being injured in your car is now lower than ever. Modern vehicles have a host of safety features to protect occupants, and reported Road Traffic Accidents have fallen by 20% over the last 10 years. So why then have injury claims increased by a paradoxical 50% over the same period?

This is not the only anomaly. When you compare the UK with France, *94% of our injury claims by volume are for whiplash, yet in France that figure is 3%. Further geographic contradictions exist within the UK too, with variations in the frequency of injuries between different regions ranging from 20% to 43%. Perhaps these variations could be explained by the incentives on offer to make an injury claim in the UK?

This assertion is backed up by figures recorded by the Information Commissioner’s Office which received 180,000 complaints about nuisance calls/texts in 2014/15 – up 12% on the previous year, with 80% of those contacted not even involved in an accident. This situation is not helped when, according to research carried out by the AA, 11% of UK motorists see nothing wrong with claiming for an injury they did not suffer.

The LASPO reforms attempted to address the rising cost of injury claims by banning referral fees, but the gains made have been almost entirely reversed. Current evidence in Claims Portal data shows soft tissue injuries are plateauing out at close to their pre-LASPO peak. This follows a 5.1% increase in submitted injury claims in 2015 alone.

The sad reality is that the current system for injury payments has not given accident victims better access to justice, as was intended, it has created a gravy train which is costing every motorist an estimated average of an extra £50 on their insurance premium.

But public opinion is changing; people are increasingly fed up of paying for other people’s excesses, they’re tired of nuisance calls, and they recognise the true cost of insurance fraud and exaggeration on society. It’s why the Government has brought forward its review of whiplash reforms, announced in the Autumn 2015 Budget Statement.

The proposed reforms will remove cash from the compensation process, replacing it with care for those who suffer minor injuries, and potentially increase the small claims track limit from £1000 to £5000. This will remove the incentive for claimants and their representatives to ‘cash in’ thereby curbing costs and reducing premiums. It will also free up insurers to provide a better service to those with genuine injury claims and provide a more proportionate intervention for accident victims.

Inevitably there will be critics, some suggesting that insurers are supporting the reforms because we seek to benefit. I want to be clear; insurers are committed to helping genuine claimants. Any cost savings generated by the reforms will be passed directly to customers in the form of lower premiums, as we saw happen when referral fees were banned.

It is customers who are currently losing out and customers who will benefit from these reforms, which will generate an estimated one billion pounds to put back in motorists’ pockets in the form of lower premiums. This is great news for customers and the reason why Covéa Insurance wholeheartedly supports the Government’s whiplash proposals."


Article first appeared on Post Online - April 2016

* Source - Frontier Economics 




Notes to Editors:

About Covéa Insurance

Covea Insurance plc is the UK underwriting business of leading French mutual insurance group Covéa, who are number 1 for property and liability insurance in France, generating over 16.3 billion Euros in premiums in 2017.  

Covéa Insurance looks after the insurance needs of over 1.5 million policyholders; delivering financial reassurance through its Standard & Poor’s A+ stable rating, as a guaranteed subsidiary of Covéa. 

The company offers motor, household, protection, pet, mid and high net worth insurance and a range of commercial insurance products, through a range of distribution channels. Employing over 1800 people, Covéa Insurance has a strong people and service ethos, having Investors In People Gold accreditation and is signatory to the HM Treasury Women In Finance Charter. It also has World Class service accreditation from the Institute of Customer Service for its Motor Claims, Home Claims and Underwriting Services teams as well as Chartered Insurer status for its Commercial and Mid/High Net Worth business.

In 2018, Covéa Insurance were recipients of the Personal Lines Insurer of the Year award at both the British Insurance Awards and the Insurance Times Awards and was the top rated insurer in the Insurance Times Broker Service Survey for both Personal and Commercial Lines.

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