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Time to put the brakes on the legal costs gravy train that is costing UK consumers 27 million every day says the ABI


Time to put the brakes on the legal costs gravy train that is costing UK consumers £2.7 million every day says the ABI

The high price UK consumers are now paying for excessive legal costs are revealed today by the ABI. Calling for a root and branch reform of Britain's civil litigation system, the ABI highlights how millions of consumers are losing out as a result of high legal costs involved in dealing with personal injury claims.

In its response to the Ministry of Justice consultation on civil litigation costs, the ABI highlights that:

• Every day UK consumers are paying the legal profession a staggering £2.7 million through their motor insurance premiums.
• An estimated 10% of every motor premium goes to the lawyers - this equates to an extra £41 a year on the cost of every motor insurance policy.
• For every £1 paid in compensation to motor accident victims, an additional 87 pence is paid out in legal costs.

Nick Starling, ABI's Director of General Insurance and Health, said:

"High legal costs are at the heart of a compensation system that is too slow, too complex and fails too many genuine claimants. Often encouraged by claims management firms, many people believe that there is a compensation culture to exploit.
"Our current system is failing not only many genuine claimants, who often have to wait too long to get the compensation they need, but all consumers who end up paying for it through higher insurance premiums. We now have a real opportunity for much-needed change to deliver faster, fairer, more cost-effective compensation and care to those who need it. This is why we support implementation of all Lord Justice Jackson's recommendations on reform of civil litigation. This consultation must be the catalyst for change that puts the brakes on the legal costs gravy train."


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Last updated 01/07/2016