The whiplash scam that's costing you £££

You are paying higher car insurance costs because of fraudulent claims for whiplash injuries...

As far as slogans for the UK go, I really don’t think ‘European capital of whiplash’ is a terribly good one.

Call me a cynic, but it just doesn’t have the same ring to it as ‘capital of culture’ or ‘capital of good food’. It probably won’t even make it into the Lonely Planet guide. Although I wouldn’t be surprised if it did, considering some of the nasty things the book’s authors have been writing about our little old country recently!

Nevertheless, the Association of British Insurers (ABI) has bestowed this less-than desirable title on our country.

But why?

Pain in the neck... and wallet

The ABI research shows that nearly 1,200 insurance claims for whiplash are made every day; six times higher than the levels of people who claim for workplace injuries. This equates to one in every 140 people in the UK making a claim for the neck ailment every year, at a cost to the industry of nearly £2 billion annually.

These extra claim payouts push up the cost of car insurance policies for honest motorists by around £74 a time, or 20%. Factor in the already high cost of car insurance, as well as the rises that will materialise when the ECJ ruling on gender comes into force, and car insurance could soon make owning a vehicle unaffordable for many people.

Robert Powell hits the streets to find out what you know about car insurance

For those not in the know, whiplash is the stretching and straining of the soft tissue of the neck. The NHS spends around £8 million every year treating the injury that is normally caused by rear-end motor collisions.

Now, obviously these high figures could just point to a chronic case of weak-neck syndrome in the UK, but the ABI (and I) doubt that! And as whiplash is very difficult to diagnose and very easy to fake and exaggerate, it seems likely that this high incidence is in fact down to fraud.

The ABI is also stating that the high levels of payouts could be exaggerated even further by ambulance chasing lawyers, no-win no-fee firms and the large number of staged ‘crash for cash’ claims.

So what can be done to straighten out this pain in the neck scam?

Straighten it out

The ABI wants to forge a partnership between doctors, insurers and lawyers to ensure better prevention and treatment of whiplash. The Association will also call on insurers to crack down on fraudulent whiplash claims and identify staged ‘crash for cash’ motor accidents.

Along with these measures, the ABI is attempting to raise consumer awareness on the need to brake safely while driving and keep a sensible distance behind the vehicle in front.

But will any of this really reduce how much you pay for your car insurance?

Well, to be honest; I doubt it. The ABI has admitted that there is a widespread compensation culture present in the UK and that doctors, insurers, lawyers and regulators alike are currently still ill-equipped to effectively identify whiplash fraud.

So it seems that this premium inflating scam may be around for a while yet.

Rachel Robson highlights four ways to reduce your car insurance costs

However, there are still a few things you can do to bring down the cost of your car insurance policy...

Save money on your policy

Shop around: When it comes to car insurance, loyalty really doesn’t pay. Providers will make their best deals available for new customers so make sure you shop around every year when your policy is up for renewal. You can get a quote quickly and easily by heading to our car insurance centre.

Avoid paying monthly: Insurers will often chop 10-20% off your policy price if you pay them up front for a whole year instead of monthly. Needless to say, this is always a good idea!

If you can’t afford the initial lump sum outlay then it’s worth getting hold of a 0% on new purchases credit card and spreading the payments over several months at no extra cost. Tesco Bank is currently offering a massive 15 months at 0% on its Clubcard credit card.

Get the right car: If you’ve got a soft spot for souped-up, modified boy racer-mobiles, then don’t expect to get a reasonably priced insurance policy. If, on the other hand you drive an old mini that struggles to overtake milk floats, you’ll probably be able to snatch a car cover bargain!

Yes, if you want to pay less for your car insurance, buy a sensible car and don’t modify it; especially if you’re young. Expensive, rare cars will also push up premiums due to the higher cost of replacement parts.

Keep it safe: Car insurance premiums are – like most things nowadays – affected by where you live. The obvious way around this problem is just to move! But if you don’t fancy that then keeping your vehicle locked up in a garage and fitting it with an alarm, immobiliser and tracker will also bring your rates down.

Increase your excess: The excess is the charge you pay when you make a claim; this is set from the outset of your policy. If you go for a higher excess, then you’ll pay less for your monthly premiums and could save money; as long as you don’t claim too often that is!

Rachel Robson takes a closer look at the fraudulent practice of fronting.

Pass plus: Advanced driving courses like Pass Plus that teach you skills such as night time and motorway driving could cut your premiums by as much as 30%; especially if you’re young.

Another driver: If you’re a young driver then adding a more experienced motorist to your policy should bring down your premiums. But don’t be tempted to name an older person as the main driver on your policy, as this will be seen as fronting; an illegal practice.

Protect your no-claims: For every year that you don’t claim on your car insurance, you’ll earn a no-claims bonus which will help to bring down your premiums in the future (eventually by as much as 65%). If you make it to five years without a claim you can choose to protect your bonus. This will increase your premiums at first, but will also allow you to make one or two claims in the future without losing the bonus.

More: Get a car insurance quote with | The multi-car insurance rip-off! | The 17 worst car insurance mistakes


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