ACSO responds to latest data showing historic lows for motor injury claims

The Association of Consumer Support Organisations (ACSO) has called on the new Labour Government to follow through on a pre-election promise to investigate the private motor insurance market after latest quarterly figures from the Compensation Recovery Unit (CRU), showed the lowest overall personal injury claims and RTA claims on record.

Matthew Maxwell Scott, ACSO executive director, said the figures contradicted insurers claims that soaring insurance premiums are being driven by claims costs. 

“There were nearly 78,000 motor injury claims registered between April-June 2024, 8,000 fewer than the equivalent quarter last year, and 13,000 down on the previous quarter. This is a reduction of well over 50 per cent since 2019.”

The ABI has said that average premiums rose by 25 per cent in 2023, and have increased a further 1 per cent so far this year to an average of £635. 

Maxwell Scott said: “Insurers have put the blame squarely on claims inflation, yet the number of claims has fallen by more than a quarter since the advent of the Civil Liability Act, which insurers lobbied hard for, and continues to fall year on year.”

Maxwell Scott said the Act also stipulated that insurers would cut £35 from every policy to compensate drivers for the erosion of their rights. 

“Instead, we have got record premiums and insurers blaming injured people for price rises. Now they are agitating for more legislation to reduce or remove damages paid to people who suffer more than one injury in an RTA.

“No one can doubt that inflation has impacted the insurance market, including for claims, but we disagree with insurers asserting that it’s all the fault of injured people making a claim. There are other factors at play.

“An independent inquiry will establish some home truths about the way the insurance market for private motor works. Motor insurance is, after all, a compulsory purchase and the market should not be in a state where it becomes impossible, or economically unviable, to make a claim after an accident. It also encourages some people to drive uninsured, which is as unwise as it is illegal and unfair on the rest of us.” 

When then-shadow transport minister Louise Haigh announced her plans for an inquiry, insurance bosses immediately hit back, with one CEO calling the decision ‘flawed logic.’ Maxwell Scott said: “We argue insurers should instead welcome the inquiry, which will establish whether private motor is indeed as competitive as they suggest.”   

Turning to other claims classes, Mr Maxwell Scott said public liability injury claims have also fallen by just over 2,000 compared to the previous quarter, continuing a long-term decline. Employers liability claims were slightly up (12,001 from 11,566) on the previous quarter while clinical negligence claims fell sharply, by a third, on the previous quarter. 

Maxwell Scott concluded: “As always, the big story is motor injury. Much the same number of accidents are occurring, but the number of people making a claim has fallen off a cliff, suggesting claiming has become a hassle and the compensation paid out too derisory for the effort involved.

“If we get to the point when the public ask: ‘what is the point of motor insurance?’ it will be a disaster. This makes the government pledge for an inquiry into pricing timely and essential. Over to the Transport Secretary to deliver on her pre-election pledge.”