Proposed changes could result in lower car insurance premiums

 

Summary

Personal injury claims have made a huge contribution to theincrease in car insurance premiums over the years. Proposed changes could end this practice, as this article explains.

  (Cheap mortgage)

Author: Anna Richardson

At the moment, the legal system in Britain forces all personal injury claims to go through the courts and be judged on an individual basis. Manyof these claims crawl through the courts at a leisurely pace, the result being expensive court costs. Even worse, for every £1 that is paid out in compensation, it has been estimated that the legal profession receives 40p for their legal work. This amounts to the British legal profession receiving an estimated £2 billion a year just from personal injury claims – unbelievable isnt it!

The insurance companies have to cover these costs,and its costing them so much that it has been estimated that for every car insurance premium, around £200 of it will be going towards paying these personal injury claim legal costs. (loan quotations)

The Association of British Insurers has decided to step in and bring this practice to an end, and has made a proposal. The ABI wantspersonal injury claims to be settled by an independent arbitration system, instead of by the courts (Cheap mortgage). It would work by setting compensation payouts for set types of injuries, a system that has been operating successfully in Ireland since 2004. There, legal costs have been lowered by three quarters.

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