Car insurance and personal injury industry reforms

Jack Straw, Labour MP for Blackburn is calling for reforms to be made to the insurance industry

Specifically, former justice secretary Jack Straw was referring to the way in which insurers refer potential clients on to personal injury lawyers for a fee. He describes the practice as a racket, making insurance premiums higher to cover the cost of referral fees.

Recommendations were laid out by Lord Justice Jackson in which he said that referral fees should be banned. Mr Straw said that statistically road traffic accidents involving injury was 31% lower than the average and that 80% of claims were for relatively minor injuries such as whiplash. Compare this to the cost of claims doubling to £14 billion in 10 years and motor insurance increases by as much as 30%.

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