Jack Straw wants auto insurance reform

← Previous Article | Index | Next Article →

Car Rental News - 27/06/2011


Jack Straw is urging reforms in the automobile insurance industry.

Jack Straw, the former justice secretary, has called for reform of Britain’s car insurance industry. Mr Straw says insurance companies are receiving payment for referring the details of their clients to personal injury law firms without the permission of their clients.

In an article published in the Times newspaper, Mr Straw says the rapidly rising cost of insurance results from cases being referred to personal injury lawyers. Mr Straw regards the practice as a racket.

Mr Straw, Labour MP for Blackburn, said he is acting on behalf of his constituents, who face rising insurance premiums. He has called on the government to implement the recommendations issued in 2010 by Lord Justice Jackson.

Last year, Lord Justice Jackson said the payment of referral fees should be outlawed. Speaking to the Today programme, Mr Straw said the practice had ‘become a huge racket’.

He went on to say that insurers are ‘complicit’ in the racket. He thinks the insurance companies should themselves consider the practice an outrage.

Mr Straw went on to say that top executives at two of the biggest insurance companies in Britain had admitted to him the practice was a ‘dirty secret’ of the insurance industry. They complain that if they don’t do it, everybody else will do it.

According to Mr Straw, garages, recovery companies and even the police sell the information to insurers. He also lashed out over the high-pressure tactics used by law firms handling personal injury claims.

← Previous Article | Index | Next Article →

Related Articles