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10th January 2017

Paying out twice – how the government is letting insurers con taxpayers out of over £350m

Thompsons submits its response to the government’s consultation on the small claims limit

A response to the government’s consultation on “Reforming the Soft Tissue Injury (‘whiplash’) Claims Process” which closed on Friday 6 January, has found that insurers will cost the UK at least £350m a year.

Campaigning law firm Thompsons Solicitors has highlighted shocking figures within the government’s own documents: changing the small claims limit in personal injury claims will cost the taxpayer £150m a year now that Insurance Premium Tax has been increased, cost the NHS at least £9m a year, and in addition gift the insurers an annual £200m extra profit.

Thompsons also pointed out that the government plans to include workplace injuries in the sweeping changes, which are being billed as a reform of ‘whiplash’ claims, without rationale or evidence.

Tom Jones, Head of Policy at Thompsons Solicitors said: “This looks like a total stitch up; the insurers knew of the consultation and its detail ahead of time, the time given to respond was much shorter than usual and the title of the consultation was wholly misleading. The government has cynically done everything possible to hide the real facts from the public.

“This is a licence for insurers to print money. The government may have tried to cover it up in guff about whiplash but, by its own admission, is happy to see the public pay out twice, once as taxpayers with the loss to the treasury and the NHS, and again when they buy overpriced car insurance. Insurers meanwhile are laughing all the way to the bank.

“Working people are being taken for suckers by the government – they think dangling “possible” reductions in car insurance with absolutely no guarantees will get people looking the other way whilst they push through changes which will take away basic legal rights that have existed for generations.

“This is really about giving insurers what they have always wanted – the end of free or affordable legal support for 95% of injured people including those injured at work and yet more money in their pockets. The government simply cannot justify politically or morally costing the country £350 million a year to feed the privileged few - fat cat insurers.”