The government has recently unveiled plans in its Autumn Statement to ban cash pay-outs for whiplash claims, which cost the insurance industry approximately £2 billion a year, which works out at an average cost of £90 per insurance policy. The government has said that a consultation with interested parties is to take place as to the possibility of ending cash compensation for minor whiplash injuries
“This will end the cycle in which responsible motorists pay higher premiums to cover false claims by others,” the Treasury said. “It will remove over £1 billion from the cost of providing motor insurance and the government expects the insurance industry to pass an average saving of £40-£50 per motor insurance policy on to consumers.”
According to figures from the Association of British Insurers the average motor insurance premium was £372 last year. Time however will tell whether any savings that are made actually get passed on to the motorist.