NU Online News Service, May 7, 2:17 p.m. EDT
The U.K. government's plan for whiplash-injury reforms is positive for the general insurance industry operating in the "whiplash capital of Europe," according to Moody's Investors Service.
In its Weekly Credit Outlook, Moody's says insurers have seen a "dramatic rise" in the frequency and severity of whiplash claims in the U.K. These claims, according to the industry, are the main reason for rising motor rates.
"Government reports highlight the dubious nature of many whiplash claims and note that theU.K.is now the 'whiplash capital' of Europe," Moody's says.
As of 2004, the U.K. led other European countries in whiplash claims as a percentage of bodily injury claims, and Moody's says the problem has worsened since then, with injury claims rising 70 percent between 2005 and 2010 while the number of U.K. road-accident casualties fell 23 percent over the same period.
The government's plan involves introducing independent medical panels for addressing whiplash claims, working with the Department of Health to issue tougher guidance on diagnosis, and increasing the small-claims threshold for personal injury claims.
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