One in five Irish know someone who has committed insurance fraud, says AIG

People also believe the standard whiplash compensation is far too high...

EU Commission, insurers, review, car insurance, no claims bonus, MEP, Mairead McGuinness

File photo of a driver at the wheel | Image: Jonathan Brady / PA Wire/Press Association Images

One in five Irish people know someone who has made an exaggerated insurance claim, according to a new survey from AIG Ireland.

Not only that, 15% of people are aware of someone falsifying information for their claim.  

The study of 1,000 people, carried out by Ignite, also revealed that close to 80% think that the average whiplash compensation of €15,000 should be far lower. A further 80% agreed that premiums were directly affected by false claims.

Nearly three quarters of people were unhappy with the country's compensation culture, with almost 85% believing that the Government needs to find a solution to the problem. 

Kevin Thompson, CEO of Insurance Ireland said:

"People believe that the appropriate award for whiplash is €3,631, compared to our average at the moment of around €15,000. 66% believe that an independent medical panel would best serve in terms of adjudicating these claims, so that we take litigation and legal fees out of the system. "

Thompson said that these high levels of awards were only fuelling the fraud problem:

"It does incentivise people to actually exaggerate or make [up] their claim because the incentive is there from a monetary point of view to make that."

Looking specifically at fixing the whiplash issue, he concluded:

"We've been very clear on this and we've been calling for reforms for the last two years.

"Firstly, the Book of Quantum needs to be reviewed and we need to have the level of injury awards benchmarked against other jurisdictions.

"We're also of the view that the powers of the Injuries Board need to be reinforced and people need to be compelled to attend medicals and they need to be compelled to give proof of their loss of earnings."

The expense of insurance premiums has provoked much public anger in recent times, increasing 25% last year and continuing to rise. The Competition and Consumer Protection Commission is currently investigating suspected breaches of competition law in the motor insurance industry.