In yet another slap in the face for the working class, the Tories have announced plans to tackle the so-called ‚Äúfraud pandemic‚ÄĚ in the car insurance industry by cutting legal aid for small claims applicants. This means that, in the majority of cases, people will be unlikely to be successful in their claims; unless, of course, they have the money to take on the insurers themselves.

In order to justify these cuts, the Tories, along with their mates in the insurance industry, have been promoting the idea that poor working-class people are driving up insurance premiums by faking whiplash injuries. Classic divide and rule strategy!

Just as cases of benefit fraud are endlessly recycled in the mainstream media to give the impression that our economic system is collapsing under the weight of the greedy poor, the Tories attempt to blame the rise in insurance premiums on ‚Äúcompensation culture‚ÄĚ.

But this view is plainly contradicted by the facts. Corporate insurers have consistently alleged that tens of thousands of people fraudulently claim for whiplash injuries, but when pressed for raw data they admit that their information is based upon their ‚Äúsuspicions.‚ÄĚ When pressed harder, these insurance companies can only cite 84 examples of fraudulent whiplash claims that resulted in convictions‚Ķ and that was over a 30-month period!

Data from the corporate insurers themselves demonstrates that the amount paid out annually by motor insurers has actually fallen from ¬£8.3 billion in 2010 to ¬£5.8 billion last year ‚Äď a decrease of ¬£2.5 billion!

Tom Jones, who is Head of Policy at Thompsons Solicitors, writes that:

it is astonishing the government has ignored that evidence, and has seen fit to use insurance industry propaganda on whiplash to take away access to justice from anyone who is injured.

Predictably, this news has been met with elation by corporate fat cats. Writing in the Times, Mark Wilson, the millionaire CEO of Aviva, one of Britain’s largest insurance companies, is triumphant:

Finally, a win for the consumer, a win for the good guys, and a win for common sense.

The idea that Aviva have the best interests of ‚Äúthe consumer‚ÄĚ at heart is laughable. Just last year, the Financial Conduct Authority (FCA) fined Aviva ¬£150 million for ripping off its own customers. This was the second largest fine ever given by the FCA. Aviva is also one of many insurance companies that has been exposed for massive tax avoidance.

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Cuts to legal aid in small claims will also be used as a precedent to deny legal aid for claimants in the workplace, unless they put in for a claim of at least £5,000 (compared to the current small claims limit of £1,000)! (The Association of Personal Injury Lawyers and the Trades Union Congress have produced an excellent booklet on this subject.)

This would have devastating effects on working class people’s access to justice, and must be fought tooth and nail.

Profits in the insurance industry have reached record highs. Direct Line and Admiral have paid out £1.65 billion in dividends in the last three years (equivalent to £221 per policy holder). Meanwhile, the cost of insurance premiums has increased 9.2% in the 12 months to the end of September 2015 taking the average cost of a comprehensive policy to £568.

The insurance industry, aided and abetted by the Tories, want to charge us more for increasingly poor services… and then have us blame each other for the situation!

The industry must be nationalised, and brought under democratic workers’ control and management. Only then can we protect against rampant profiteering and corruption.

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