Yet again it is in the press how whiplash claims are driving up your insurance premium and that is the lawyers who are (somehow) responsible for this. Do you believe this? Really?
Whilst insurers will want their fair share of the market, they will not want the whole market, many insurers could simply not cope with being a sole insurance provider – a reason why they also do not want to be the cheapest, they will become inundated with new customers, as well as not being able to cope with this volume of new business if some large scale disaster occurs that insurer could be left picking up the majority of the tab, something even the largest of insurer can ill afford.
So, how do they prevent themselves from being the cheapest, most attractive option for the masses? Why, they increase their premiums of course, and as with utility providers we all know what happens next, other insurance companies follow blindly like sheep also putting their premiums up for fear of being the cheapest and hence most attractive to the masses.
Insurance companies are in business to make money, they do not insure you or I from the goodness of their hearts. Yes they provide us with financial protection from disasters, theft and accidents but this is not because of some charitable calling. These are companies with responsibilities to share holders, shareholders are interested in making money, whether that be by increases in value or income by way of dividends. Insurance company shares will only be an attractive option to investors if they make them money in this manner, the insurers therefore are more than keen to make substantial profits in order to keep their current shareholders happy and attract new ones.
How do the insurers increase their profits? They do this in part by minimising what they pay out when a claim is made against one of their policies and also by increasing the premiums they charge for their insurance policies. Insurance premiums creep up each year, and not just motor policies, house insurance, mortgage protection insurance etc, all types of premium increase year on year. What I wonder are the insurers excuses for increases in other types of premium, surely they cannot all rest on the shoulders of lawyers who take on whiplash injury claims?!
What insurers haven’t been telling you is that often when a claim is submitted they do not respond in a timely manner, if at all and this means that we have to spend more time (and hence more money) in pursing the claim on behalf of the innocent injured party. Quite often early on in the claim it is pretty obvious that the injured party’s claim will be successful yet the insurers insist on maintaining a denial of liability when an early admittance will ensure a claim is settled incurring only minimal legal costs. Sometimes they will even insist on taking a claim all the way to trial when they should have settled early on in the process – what could have cost them £1200 plus VAT in legal costs will then cost them upwards of £20,000 plus VAT instead. Whilst personal injury claims will no doubt have a tiny affect on the cost of insurance, this illustrates that the insurance companies getting their own houses in order first is likely to have a dramatic reduction in the costs they incur in relation to personal injury claims.
If you have been injured in an accident, whether sustaining whiplash in a road traffic accident or by being injured in any other type of accident where someone else is to blame, then please contact one of our specialists in the Personal Injury Department at HilliersHRW Solicitors LLP on 01234 858000.
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