European Neighbours can provide UK whiplash reform blueprint – AXA Whiplash Report

The report is launched today at a roundtable co-hosted by the Rt. Hon Jack Straw, MP for Blackburn and Chris Voller, AXA Claims Director and author of the Report. In comparing whiplash claims across several countries, it analyses the factors behind the markedly 2 different claims volumes and insurance costs - notably differences within the respective legal and medical systems.

16 July 2013

Posted in Financial results

by Jennifer Chilcott (see media contact)

  • Major report finds that France and Sweden provide models for success in tackling escalating whiplash claims
  • Calls on Government to adopt Swedish-style minimum time threshold* on whiplash injuries and requirement for diagnostic proof as per French system
  • Introducing medical threshold, based on Quebec Task Force** scale, below which compensation is not recoverable would significantly reduce claims AXA estimates
  • Government urged to implement proposed increase in the Small Claims Track limit to £10,000 in respect of personal injury-related motor claims

> Download the Whiplash Report

The report finds that France and Sweden provide instructive blueprints for success when tackling an escalation in whiplash claims due to suspected exaggerated or fraudulent claims. AXA believes that aspects from the French and Swedish approaches to whiplash, coupled with innovative thinking by UK policymakers, can and should be factored into the way in which the UK manages these claims. In France, where the average premium is €410 (versus €681 in the UK) and where whiplash injuries account for only three per cent of all bodily injury claims, there is a firm emphasis on objective proof. With regards to whiplash, this means that injury is not recognised unless the medical professional is able to see evidence of injury, such as on an MRI scan or X-Ray.

In Sweden, where the average premium is €369, a 'Whiplash Commission' was set up and financed in 2002 to counteract a spiralling number of claims. A time limit system for the onset of symptoms is used and cases where symptoms appear more than 72 hours after the incident are generally rejected by insurers. Whilst this has been treated more as a rule of thumb, as opposed to a strict law, this minimum threshold was reinforced by the Whiplash Commission's medical group in that symptoms must be discovered within three to four days
after the accident otherwise it is not classed as a whiplash injury.

Headshot of Chris Voller, Claims Director at AXA UK

Our research looks at examples from across the globe where various countries have been successful in preventing the escalation of whiplash claims, including innovative work in Germany, Canada and Switzerland. However, we believe that certain measures adopted in France and Sweden in particular offer very valuable insight into what works in practice and demonstrate several elements which could be adopted by the UK and that we believe would make a significant difference to the cost of premiums. We would urge the government to look at what has worked in France and Sweden - specifically in relation to the requirement for medical evidence and the implementation of a minimum time threshold - as it considers how best to manage whiplash claims moving forward.

Chris Voller, Claims Director at AXA UK

Key recommendations in the AXA Whiplash report include:

  1. The MoJ proposals to introduce a national accredited panel of experts to assess contested whiplash claims should be further developed, including shifting the burden of proof onto the claimant in a similar manner to the French system.
  2. Linked to this, independent medical reports should categorise whiplash in accordance with the Modified Quebec Task Force** scale. There should be a medical threshold below which compensation is not recoverable, e.g. medical reports could categorise Quebec** grade 1 and 2 as below the threshold of compensation while grade 3 and 4 injuries receive compensation. AXA UK estimates that this would significantly reduce the number of whiplash
  3. Implement a minimum threshold system in the UK, similar to that used in Sweden, based on a time limit system for the onset of symptoms, after which no compensation claim is recoverable.
  4. The proposed increase in the Small Claims Track limit to £10,000 in respect of personal injury-related motor claims is welcomed and should be implemented.
  5. Existing reforms, such as banning referral fees to personal injury lawyers have provided a good platform, but Government must be vigilant and amend legislation if avoidance behaviour becomes more common. Schemes are already emerging to avoid the ban on referral fees - it seems clear that the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) is being circumvented by those who are finding creative ways around the ban. Government should consider how best to prevent this significant driver of adverse claims activity.