Transport Committee re-opens insurance premiums inquiry
The transport committee has re-opened its inquiry into cost of motor insurance and has called on former justice minister Jack Straw to give oral evidence.
Committee chair Louise Ellman, a Labour/Co-operative MP, said Straw’s recently published report on the rising cost of premiums would make a ‘powerful contribution’ to the debate.
Straw’s report was highly critical of insurers taking referral fees from personal injury solicitors, and called for a ban on such payments.
It also addressed the increase in the number of personal injury claims resulting from motor accidents and the role of claims management companies.
Ellman said: ‘Motorists continue to suffer as premiums increase and there is mounting evidence that the insurance industry itself is part of the problem.
‘Jack Straw’s research is a powerful contribution to the debate and as well as hearing what he has to say I will want to hold the insurance industry and the government to account.'
The meeting will take place in the autumn, with a date still to be announced, and other witnesses will be called.
Comments
Let's see. Can we expect a
Let's see. Can we expect a proper inquiry or will they take the standard shortcut and simply rely on dubious figures/anecdotes supplied by the insurers?
The politicians have got the bit between their teeth
Until now the insurers have got away with blue murder because no one outside the industry and the legal profession realised what was going on, and how the public were being swindled. Now, there's bitter resentment among the paying public at having to pay large increases in their motor premiums.
Jack Straw hit the nail on the head, when he said that the abuses occur because there is too much money sloshing round the system, and much of it gets siphoned off to intermediaries. And where does this extra money come from? Yes, got it in one - the paying public.
From a politicians point of view, it's a win win - they are campaiging on behalf of ordinary motorists (who coincidentally have votes) against ambulance chasers, fraudsters and grasping insurance companies. And, it's an easy idea to grasp, and once you've got the idea, you are unlikely to change your mind when confronted by some dodgy statistics produced by insurers.
The government seems to have grasped the political implications of seeming to champion ambulance chasers and dirty secrets, and there was some deft footwork on wednesday as they sort to distance themselves from being in favour of referral fees.
This one will run.
It's a shame that all this
It's a shame that all this relies on the fallacy that the increased premiums are resulting from increased/fraudulent claims. The predictive and now fixed costs and increased third party capture activity can only have seen their overall payouts decline.
All is well for the insurers though, they get a good excuse to maintain their profit levels in the face of global slump/falling markets/low interest/bad investments (the real reason for the increased premiums) whilst the media hysteria ensures that Cameron and his populist pandering pals blindly legislate to the disadvantage of those that have been avoidably injured.
Perfick.
Hope you're right but doubt
Hope you're right but doubt it.
This lot couldn't grasp the political implications of a Third World War!
The matter needs to be grasped now, not in a few months time when the Committee next meets. The Bill is going through NOW, it should be amended NOW to outlaw referral fees-that was what Jackson recommended.
My guess is that after some huffing and puffing, the matter will be quietly dropped-probably after various directorships promised to various MPs.
So, another day with a
So, another day with a tabloid newspaper doing an "investigative journalism" piece about referral fees, insurance premiums and greedy lawyers.
Still nothing from the Law Society or the SRA. They can't even be bothered to issue a press release along the lines of "the OFT effectively forced referral fees on the profession". No, nothing.
Hardly surprising solicitors are an easy target, neither the representative body or the regulator say a damned thing in support of us.
Forget the past
They can't say or do anything, as those who wanted referral fees claimed that the ban was legally unenforcable. The fact that a judge decided that it was enforcable a few months after the ban was lifted showed the mendacity of those at the Law Society, who argued that the OFT would strike down the ban but this is nothing compared to the mendacity of the Labour Government who supported all this. Expect the next Labour Party attack to be on ABSs. Lord Falconer's pet project.