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The British legal profession get paid 40p for each £1 paid out in personal injury compensation. Moves to cut legal costs by 75% should result in lower car insurance premiums.
Author: Michael Challiner
It is estimated that for every £1 paid out in compensation for
personal injury claims, the lawyers get paid 40p. In fact, the legal costs have grown so outrageously that the British legal profession now cream off £2 billion a ( cheap car insurance ) year to resolve legal battles for personal injury claims.
Most of these personal injury cases slouch unhurriedly through the courts in lengthy and inevitably costly legal actions. As a result, around ( best mortgages ) £200 of the average car insurance premium goes towards the risks associated personal injury claims. So successful moves to cut these costs should result in a significant reduction in car insurance premiums.
In this context recent moves by the Association of British Insurers to take personal injury claims out of the courts ( home insurance ) and into an independent arbitration system, are to be welcomed. A similar system was established in Ireland in 2004 and as a result, legal costs have been slashed by 75%.
Whereas today each personal injury insurance claim is decided individually in court, the arbitrator proposed by the ABI would map out reference payments for each type of injury. In Ireland for example, a back injury that recovers within 12 months, is allocated the equivalent of £11,000 whilst a neck whiplash injury, which recovering over 12 months, is worth £9,400.
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