Brokers, insurers argue over injury claims payouts

Weekly whiplash news review: 7 days ended 30 jan 2013:

A row has broken out between brokers and insurers over payouts on personal injury claims, with brokers pointing the finger at the weak economy.

According to new research revealed by the British Insurance Brokers’ Association, almost two out of every three brokers had to put up a dickens of a fight to get injury claims paid out. On top of that, nearly three out of every four brokers surveyed indicated that overturned at least one claim rejection over the past 12 months.

Chief executive for Biba, Eric Galbraith, commented on the research study’s findings, remarking that the poor economy has led insurers to institute stricter anti-fraud systems and policy interpretations. The result, Mr Galbraith says, that insurers are reviewing personal injury compensation claims much more closely, especially those claiming compensation for whiplash.

However, just a few hours after Biba released its figures, the insurance industry fired back, denying any implication that any genuine claimants were finding it a struggle to receive their entitled compensation awards. The Association of British Insurers refuted Biba’s claims directly, claiming that there was a distinct lack of evidence of any such lack of claims payments.

The ABI’s director of general insurance, Nick Starling, pointed out that about £28 million is paid out every day by insurers on motor and household insurance policies. Increasing scrutiny to combat fraud is needed, the ABI says, as insurers are highly skeptical that there are 10,000 genuine instances of whiplash occurring every week in the UK.

Meanwhile, Biba refuted the ABI’s claim of ‘no evidence’ by highlighting several instances where brokers had helped several policyholders reach settlements with a recalcitrant insurer that originally turned down a claim. Meanwhile, the insurance underwriter sector has allied itself with insurance providers by calling out brokers, accusing them of lacking transparency when it comes to how they earn a living and calling for more stringent regulation of the sector in order to prevent so-called ‘conflicts of interest’ on the part of brokers.

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