New Bans On Fraudulent Claim Management Companies

New checks on fraudulent injury claims have been invoked by Justine Greening, Transport Secretary, in a bid to prevent Britain from becoming the ‘whiplash capital of Europe’ as some put it.

This Saturday, Greening proposed to put a ban on those claims that included low speeds, along with introducing rigorous medical check-ups and hunt down ‘ambulance-chasing  lawyers’ who have already made millions off the racket. Earlier, the Daily Mail reported a whopping 5339 claim-management companies, or CMCs, that refer victims of car accidents to no-win, no-fee law firms in return for money. Acting on the news, the Transport Department initiated a crackdown, shutting down 707 such companies on the grounds of malpractice.

According to government sources, the reason why Ms. Greening has taken such hard steps is because the law firms have tried to block the reforms and acted in their own selfish interest, sending car insurance premiums skyrocketing.

According to Ms. Greening, “The Mail on Sunday is absolutely right to campaign on the spiralling cost of motor insurance and has already highlighted a near-epidemic in whiplash injury claims fuelled by ambulance-chasing lawyers. Sadly, Britain is now the whiplash capital of Europe, with more than 1,500 claims each day.”

The crisis has caused a special summit to be held in Downing Street, chaired by the Prime Minister himself. Meanwhile, Ms. Greening will be meeting key Cabinet peers to discuss the measures to be invoked. These colleagues will include Justice Secretary Kenneth Clarke, Home Secretary Theresa May, Health Secretary Andrew Lansley and Business Secretary Vince Gable.

She also said that despite the distinct drop in deaths and injuries caused by car crashes, cheap insurance premiums still continue to remain elusive to the average British citizen.

The 707 companies that have been shut down have been accused of faking car crashes, pressuring victims of car accidents to make claims and cheating their customers out of compensation cash.

According to a Ministry spokesperson, “Claims management companies are subject to strict rules of conduct. We have made it very clear to businesses that we will not accept any malpractice or attempts to take advantage of consumers.”

According to industry experts, some of the CMCs paid fees to repair garages and insurance firms so that they’d hand over the details of car-crash victims. These victims were then harassed via phone calls and text messages to make false and exaggerated injury claims.

Louise Ellman, Labour MP and chairman of the Transport Select Committee stated: “Claims management companies are a major problem. They are the worst part of this merry-go-round of lawyers, insurance companies and brokers, after someone has had an accident. There needs to be a clampdown.”

The fraudulent activities of these CMCs may have rich pickings, but they have caused the average insurance premiums to rise to usury levels, so that an honest applicant cannot hope to find cheap premiums even on the good old car insurance comparison websites.

Those who do compare car insurance have said that only by rigorous shopping about on different car insurance comparison networks can one land up with a cheaper insurance premium that still provides comprehensive cover.