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Government plans to reform legal system will mean a better deal for genuine claimants and insurance customers says the ABI

Today's Government announcement on civil litigation reform will put the brake on runaway legal costs and mean a better deal for genuine claimants and insurance customers, says the ABI. The ABI has been campaigning for reforms to the current system, especially reducing the high level of legal costs in settling personal injury claims, one of the major reasons for the general rise in the motor insurance premiums.

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

"These reforms are good news for genuine claimants, who too often struggle to get fair compensation under the current system. The ABI has long campaigned for reform that puts the genuine claimant at the heart of a simpler, faster, more cost-effective system.

"For too long ambulance-chasing lawyers and claims management firms have encouraged many people to believe that there is a compensation culture to exploit. The result has been a slower process for genuine claimants, and out of control legal costs that end up being paid for by all consumers through higher insurance premiums. Currently, for every £1 motor insurers pay out in compensation, an extra 87 pence is paid in legal costs.

"By implementing in full the recommendations of Lord Justice Jackson's review of civil litigation, the Government has addressed the injustices of our civil justice system. And motorists, who are paying an extra 10% on their motor insurance as a result of high legal costs in settling personal injury claims, can look forward to cheaper insurance in the future.

"The final part of the reform process must be the abolition of referral fees and we urge the Government to ban them"

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Last updated 01/07/2016