Car insurance premiums have been risen sharply due to fraud, according to MPs on the Commons Transport Select Committee.
They were informed by the police that there are as many as 30,000 staged accidents a year. The select committee is calling for a dedicated police unit to be set up which should be paid for by the insurance industry in order to tackle the escalating problem.
Labour MP Louise Ellman, Chair of Transport Committee and Nick Starling, director of General Insurance at the Association of British Insurers, debated the issue.
This is what they had to say:
Louise Ellman commented "The police told us that they knew of about 30,000 staged accidents last year and that's where accidents are contrived; a driver deliberately slams on the brakes, the car behind goes into them, a large number of people then make claims for injuries they may or may not have sustained. In some cases the whole incident is fictitious. This is done by criminal gangs costing a great deal of money and the police say that they don't have enough resources to really root that out but they could do more if they had closer working with the insurance industry. So that is one of the areas that we think should have more attention.
Nick Starling was asked why the insurance industry are you not working more closely with the authorities and the police in particular?
He responded "We do work extremely closely with the police. We set up something called the Insurance Fraud Bureau five years ago and it's the Insurance Fraud Bureau that's actually led on analysis of this problem, identifying it and going to the police with the issues and they've had some big successes round prosecutions. It's a big problem, but the biggest problem in motor insurance is in fact the ever escalating cost and number of personal injury claims fuelled by claims management companies and we think that the Committee has missed an opportunity to really tackle that as the central problem which is driving most premiums up.
They were informed by the police that there are as many as 30,000 staged accidents a year. The select committee is calling for a dedicated police unit to be set up which should be paid for by the insurance industry in order to tackle the escalating problem.
Labour MP Louise Ellman, Chair of Transport Committee and Nick Starling, director of General Insurance at the Association of British Insurers, debated the issue.
This is what they had to say:
Louise Ellman commented "The police told us that they knew of about 30,000 staged accidents last year and that's where accidents are contrived; a driver deliberately slams on the brakes, the car behind goes into them, a large number of people then make claims for injuries they may or may not have sustained. In some cases the whole incident is fictitious. This is done by criminal gangs costing a great deal of money and the police say that they don't have enough resources to really root that out but they could do more if they had closer working with the insurance industry. So that is one of the areas that we think should have more attention.
Nick Starling was asked why the insurance industry are you not working more closely with the authorities and the police in particular?
He responded "We do work extremely closely with the police. We set up something called the Insurance Fraud Bureau five years ago and it's the Insurance Fraud Bureau that's actually led on analysis of this problem, identifying it and going to the police with the issues and they've had some big successes round prosecutions. It's a big problem, but the biggest problem in motor insurance is in fact the ever escalating cost and number of personal injury claims fuelled by claims management companies and we think that the Committee has missed an opportunity to really tackle that as the central problem which is driving most premiums up.
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