Industry welcomes government fraud action

The MoJ measures are a bid to reduce the amount being paid out by insurance companies on fraudulent claims and to enable savings to be passed on to customers.

The measures included: plans to ban lawyers from encouraging people to make claims by offering them incentives like cash or iPads; reducing whiplash claims by improving medical assessments, ensuring they are only conducted by independent accredited professionals, and setting fixed fees for medical reports this year; and introducing new rules this year to restrict the practice of settling whiplash claims without confirmation of the claimant's injury.

Martin Milliner, LV claims director, said: "In the past there were no consequences for the fraudsters who exaggerated or invented injuries in order to claim compensation. This new legislation fundamentally changes the game and will help put an end to this mentality whereby a claimant had nothing to lose by inflating a claim. If a fraudster risks losing their entire pay-out due to exaggeration, this will level the playing field for insurers and claimants and speed up justice for those with genuine injuries."

"This legislation only goes so far and will not prevent a large part of the ambulance chasing industry from offering such inducements to potential claimants. The Ministry of Justice must not hold back from banning all upfront incentives for personal injury claims if it wants to abolish the ‘have a go' mentality that is pushing up costs for all," Milliner said.

Association of British Insurers director general Otto Thoresen said: "These changes are a very positive development for the vast majority of honest insurance customers who end up paying for the fraud of the minority. We applaud the decision to ban the distasteful advertising which offers cash or other inducements for personal injury claims. This only serves to reinforce to unscrupulous claimants that there is a compensation culture to exploit."


The clock is ticking for the deadline to enter the 2014 Insurance Fraud Awards. If you have a success you would like to shout about, start an entry today here.