Apparently, a few days ago, in the mythical land of Oz, the AXA man (distant relation to the Tin man) and the Straw man presented a wizard idea to an invited audience. ‘There is no such thing as whiplash’, they declared, ‘even if it existed, which it doesn’t, it doesn’t hurt. If you think something might be wrong and if you hurry, you can see one of our approved doctors over in Munchkin Land who will tell you how to get back to work asap. Naturally, the Wizard will not be paying compensation under any circumstances – premiums are high enough around here, what with accidents happening every day.’
Monday’s Dispatches investigation on Channel 4, presented by Harry Wallop certainly packed a punch and was a welcome riposte to the insurance lobby’s PR deluge of misinformation, miscreancy and mendacity.
We hope it is the first of many broadsides in the fight to redress the balance in favour of the British public’s entirely reasonable expectation to be treated fairly by some of the world’s largest corporations.
Not much to ask you would think but these guys have had it their own way for so long now and have so successfully weasled their way into government circles that they are setting the insurance agenda for all of us. A concerted effort by the concerned is required NOW to identify the real villains of the piece and the true insurance scammers operating in this dysfunctional market.
In our opinion this documentary was a good first step because it exploded the myth that insurance companies are primarily concerned about us, their customers.
The film absolutely nailed the point that the insurance companies and accident management firms are only concerned about maximising their profit margins as they pressurise motorists to deal with their ‘approved’ body shops and pressurise the garages to carry out work at minimal cost., often using non-standard parts.
Now this would not in itself be such a problem if savings were shared between insurance companies and policy holders and work was carried out to a high standard but this does not happen…and our premiums go up and up.
Evidence from experienced people in the trade confirmed that the pressure insurance companies put on body shops to cut costs compromises the integrity of the damaged vehicle and the safety of the driver and their family.
The story gets worse.
If a driver is involved in a no-fault accident his/her insurance company will seek to max out the ‘value’ of the claim by shamelessly inflating the cost of the repairs and hitting the other side for all they are worth….and who pays for this?
Correct. We do every day.
Whilst the insurance companies are busy portraying themselves as ‘holier than thou’ and the nation’s protectors of the vulnerable, they are busily scamming the market for every penny they can extract from supplier rebates and other kickbacks and exploiting their customers without any regard to the principles of good business practice, far less business ethics.
The insurance companies then have the bare-faced audacity to stuff their own pockets with all this extra ‘bunce’ and then claim that innocent accident victims who have the temerity to claim compensation are responsible for the hike in premiums which the Office of Fair Trading (OFT) states are inflated to the tune of at least £250m per annum by the industry’s own malpractices.
Their underhand tactics have thankfully not gone completely unnoticed. The OFT has announced that it will be investigating the insurance market, despite the best efforts of a toadying government to foster the myth of a compensation culture and agree to virtually everything the Association of British Insurers (ABI) has demanded in recent years.
In typical weasel word fashion, as befits its modus operandi, the ABI claims that it welcomes an investigation. Aye right, we’ll see…as we live in hope.
If a claim is known to be fraudulent why does the industry not take action to prosecute the fradusters? The conclusion must be that the insurance companies are spending a hefty chunk of our car insurance premiums on fraudulent claims. Perhaps the ABI’s Nick Starling can explain why this SCANDAL is allowed to go on unchecked.
Could it be that there are far fewer fraudulent claims than suits the ABI position and that the creation of the ‘bogeyman’ of an insurance fraudster is a very useful whipping boy when it comes to peddling lies about whiplash claims and the impact on premiums?
We will be asking the OFT to look at this matter very closely…and checking with Harry Wallop to see if he is planning to look at the government’s and the insurance industry’s perverse approach to dealing with personal injury claims.
Written by Andy Thorogood, Business Development Manager, Bonnar Accident Law.
Finally, we hope, insurance companies are to face the government’s competition watchdog over their oft-quoted claims that inflated motor premiums have nothing whatsoever to do with their business practices.
Really? Do they think we are THAT stupid?
At last a government department has blown their cover and published what everyone, barring Jack Straw and chums, knows to be true:
Insurance companies ARE taking advantage of the system to inflate premiums for drivers by £225m a year, the Office of Fair Trading (OFT) reports today.
The competition watchdog says that after a road traffic accident, insurers of the not-at-fault driver and others, such as brokers, credit hire organisations and repairers, exploit a lack of control in the current system. They charge referral fees for using expensive hire organisations and then add to the cost by replacing the car for longer than is necessary.
The OFT has provisionally decided to refer the private motor insurance market to the Competition Commission after finding evidence that firms are competing in a ‘dysfunctional way’.
The report states that the government has focused its attention on reducing the cost of personal injury claims, but without intervention in the cost of replacement vehicles and repairs, artificially-inflated premiums are ‘likely to persist’.
Exactly. Three cheers and due credit for a chink of light in a tunnel of darkness and despond…
John Fingleton, chief executive of the OFT, said:
‘Competition in this market does not appear to work well for drivers. We believe the focus that insurers have on gaining the competitive edge through raising their rivals’ costs means that drivers pay more than they need to for their motor insurance policies.
‘Because insurers are distracted from competing primarily on the quality and value of service provided to insured drivers, incentives for greater efficiency may be reduced.’
Donna Scully, chairman of the Motor Accident Solicitors’ Society (MASS), said the scale of the problem could be ‘immense’ once it is fully investigated.
‘Money is clearly being made from consumers behind their backs and MASS would welcome full disclosure of specific fee income on every case so that the consumer is fully informed,’ she said.
It is no wonder the whole sector has fallen into disrepute and that consumers are so wary of everyone who operates in it, and frustrated by exploitative practices they are likely to encounter when they make a claim.’
The Association of British Insurers welcomed the report – hmm, doubt that – but declined to address the accusations over its members receiving referral fees from credit hire companies.
Now THAT we believe…
Nick Starling, director general of the ABI, said: ‘For too long insurers have faced inflated rates for credit hire cars and excessive hire periods which have led to higher insurance premiums for customers.
AND THERE WE HAVE IT.
WEASEL WORDS FROM THE ‘WRONGED’.
INCREDIBLE AS IT MAY SEEM, AFTER YEARS OF VILIFYING ROAD TRAFFIC ACCIDENT VICTIMS AND PERSONAL INJURY SOLICITORS, THE INSURERS ARE NOW SEEKING TO BLAME THE CREDIT HIRE AGENCIES AND VEHICLE REPAIR COMPANIES FOR THE RISE IN PREMIUMS.
Soon there will be nobody else left to blame and what then Nick?
Karl Tonks, president of the Association of Persosanl Injury Lawyers (APIL) commented:
‘For years the insurance industry has sought to blame anyone and anything but itself and its own sharp practices for high insurance premiums. Legal costs for compensation claims were slashed two years ago for this very reason, but premiums remained sky high.’
The OFT expects to reach a final decision by October 2012.
In our opinion it can’t come soon enough.