Is the UK Compensation Culture a Coalition Conspiracy?

August 8, 2013

It’s been an interesting week for the personal injury sector. While the battle rages on over the merits of AXA’s whiplash report (more on that shortly), an interesting report published somewhat quietly has revealed work-related personal injury claims are down 60% on a decade ago.

So are insurers using the ‘whiplash’ debate as a smokescreen to cover the significant profits they are surely making (assuming company insurance premiums have remained constant) compared with a ten years ago?

Hazards’ report into work injury – the figures

According to the latest quarterly edition of Hazards’ ezine, at the turn of the century, 2000-2001, there were almost 220,000 claims for personal imjury at work.

Compare that to 2011-2012 when there were less than 88,000 similar claims lodged, the drop means there are a staggering 60% less cases being processed today.

One may argue that Health & Safety laws have no doubt had an impact on that figure, and they’d probably be correct in making that assumption.

What would be interesting to accompany that statistic is the price of premiums for companies insuring their staff against personal injury over the same period, given the lengthier measures firms now have to go to (at their cost) to protect their staff.

Occupational Cancer – another area causing consternation

The long-term effects of cancer attributed to certain working conditions also shows a paltry number of successful claims, according to Government figures.

In all, the figure suggests that less than 2% of cancer sufferers receive their due compensation.

Additionally, emphysema and chronic bronchitis account for the deaths of 4,000 workers every year in the UK. In the last batch of figures, only 59 of those families received compensation for their loss.

With the Government actively snipping away red tape in favour of firms when it comes to workers’ health and safety, it’s highly unlikely there will be any improvement in those figures under the current regime.

The Whiplash debate goes on – MPs now wading in

Against the backdrop of the AXA whiplash report, Ministers are echoing some of the recommendations made in its findings, irrespective of the doubt cast on the statistics by the personal injury sector.

One can see why the subject has reached Parliament, however. According to the evidence MPs were given to preside over, fraudulent whiplash claims account for £2bn per year of insurers’ money, the cost of which is passed back to motorists at the princely rate of £90 per head.

Conversely, MPs have put it to the insurers that it’s their house that needs putting in order, not that of the personal injury solicitors.

Nor, for that matter, should the general public branded negatively, many of whom are being dissuaded from making a legitimate personal injury claim thanks to terms like ‘compensation culture’ and ‘ambulance chasers’ being banded around so readily.

The suggestion in the MPs’ report is to both:

  1. reduce the time insurers allow for claims to be made following an accident that could be deemed responsible for whiplash
  2. demand more medical evidence from claimants about their condition

Last week, we considered the difficulties both recommendations would face should they indeed be implemented; read more about that here.

What was very pleasing to see in the MPs’ ensuing report was that accident victims who suffer whiplash shouldn’t be demonised if their case is genuine.

  • Should more be being done to support victims of work-related conditions?
  • Is the insurance industry using ‘whiplash injury’ to deflect interest in the reduction of work-related personal injury?
  • And do MPs’ recommendations have merit, that insurers are in some way themselves to blame for the phenomenon that has caused the UK to become “the whiplash capital of the world”?

We’d love to hear your thoughts…