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Aviva's take on why Civil Liability Bill needs to be enacted

Aviva's take on why Civil Liability Bill needs to be enacted | Insurance Business


Losing the incentives that lure insurance fraudsters – in the view of the UK’s biggest insurer, that is one of the benefits to be gained when the proposed version of the Civil Liability Bill is enacted.

Aviva, the FTSE100 provider which serves one in every four households in the UK, believes fraudulent and exaggerated whiplash claims will continue to rise not only in terms of number but also as far as cost is concerned, unless the Civil Liability Bill becomes law. Expressing its support for the pending legislation, Aviva cited the £59 million of bogus injury claims it detected last year.

According to the insurer, it is investigating more than 17,000 personal injury claims for suspected fraud. In addition, motor insurance accounts for 60% of all fraud detected by Aviva.

“Insurance fraud is a crime, and as our figures show, it is big business,” noted Andrew Morrish, claims director for Aviva UK General Insurance. “Our customers are telling us they are sick and tired of paying for fraud through inflated premiums. But it doesn’t have to be like this.

“The Civil Liability Bill is a rare opportunity to remove the financial incentives that are at the heart of motor insurance fraud and drive the UK’s compensation culture – including the 900 million nuisance calls and texts made annually which try to encourage people to claim for an injury, often regardless of whether they’ve even been in an accident.”

The claims director is of the view that the bill can eliminate the temptation that entice fraudsters and at the same time reduce the cost of minor whiplash claims.

“The solution is actually very straightforward: reduce compensation awards as proposed in the Civil Liability Bill to remove the incentive for fraudsters to commit these terrible acts,” stated Morrish. “This pro-consumer legislation will help make our roads safer, our insurance cheaper, and deal a meaningful blow the UK’s compensation culture.” 

This is consistent with what the Secretary of State for Justice and Lord Chancellor David Gauke expressed last week during the bill’s second reading in the House of Commons.

“The purpose of our reforms is to compensate the genuinely injured and to improve the system for all by reducing the number and cost of whiplash claims and deterring fraudulent and unmeritorious claims,” explained Gauke.

“The measures in the bill will do that by introducing a ban on settling whiplash claims without medical evidence,” he said. “That will discourage fraud and incentivise insurers to investigate claims and provide reassurance to claimants that they are being compensated for the true extent of their injuries.”