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ABI : UK compensation culture still needs reform

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Further evidence of the need to reform the UK compensation culture comes today with an ABI-commissioned survey showing that three in four people have received an unsolicited text or phone call from a claims management company offering them the chance to claim compensation, even though the overwhelming majority had no grounds to claim compensation.

The results of the ABI-commissioned survey of over 2,600 adults highlights that:

– Over three-quarters of people (78%) have been contacted by a Claims Management Company (CMC) asking if they had been involved in an accident or been mis-sold payment protection insurance. In London, the figure rose to 82%.
– Nine in ten people (92%) who received such a message from a CMC said it was not relevant to them.
– There is strong support for a crackdown on CMCs, with three in four people backing a ban on unsolicited messages as a way of reducing the epidemic of fraudulent whiplash claims.

James Dalton, the ABI’s Head of Motor and Liability, said: “Unsolicited contact from claims management firms is a symptom of our dysfunctional compensation system, which encourages frivolous, exaggerated and even invented claims, especially for personal injury. The real losers are honest policyholders who end up paying the price through higher insurance premiums. Our survey results show widespread public support for our calls to tackle this nuisance, as part of wide ranging reforms to the compensation system, so that genuine claimants are the only ones who receive pay outs.”