The British Insurance Brokers Association (BIBA) said it is mainly happy with the Transport Committee’s follow up report on the cost of insurance, but it disagrees with the Committee’s stance on the banning of referral fees.
While BIBA agreed with the report on most issues, they raised questions about the idea of banning referral fees.
“Although the current system is flawed, BIBA does not believe banning referral fees is a panacea in itself, or that the end of these fees will directly reduce motor insurance premiums,” said Graeme Trudgill, Head of Corporate Affairs at BIBA.
“The real solution is to deal with the fraudulent element of the £2 billion cost of whiplash claims. More rigorous testing of alleged whiplash claims and a reduction in legal costs in this area is very important.
“We believe the attack on whiplash culture has to come from medico-legal evidence.”
While disagreeing with the issue of referral fees, BIBA’s response was generally positive. They were happy with the reports view on insurers having access to Driver and Vehicle Licensing Agency database, and said they would continue to push for the introduction of this service.
The issues of data protection and measures to curb uninsured driving were also welcomed by BIBA.
Trudgill continued, “BIBA was delighted to see the introduction of Continuous Insurance Enforcement in 2011. Any review of sentencing guidance which would help reduce uninsured driving would be welcomed.”
BIBA also said that they would be keen to engage with the establishment of a cross departmental ministerial committee on the reduction of the cost of motor insurance.
