Drivers to save on car premiums as Cameron cracks whip on fees

The Prime Minister announced at a Downing Street summit with insurers, businesses and consumer groups that he would reduce the current £1,200 fee for lawyers on small personal injury claims.

In return, insurance bosses committed to ensuring the savings were passed on to customers and to challenge more health and safety claims rather than simply paying out.

The UK has become “the whiplash capital of Europe”, Number 10 said, with 1,500 claims a day for even the most minor accidents adding £90 a year to average bills.

West Yorkshire is one of the worst-hit areas, with premiums in Bradford among the highest in the country.

The director-general of the Association of British Insurers, Otto Thoresen, said the meeting had been “very positive”.

“We are encouraged that the Government recognises the need to tackle the factors that are driving up the cost of motor insurance, such as the reform of our dysfunctional compensation system,” he added. “We will be working with the Government to ensure that we make real progress as quickly as possible.”

The summit was welcomed by Bradford East MP David Ward, who launched a campaign on the issue after it emerged some of his constituents were quoted more than £20,000 for basic annual car insurance. He said: “The noose is tightening on all the parts of the system that work against motorists.”

Mr Cameron said: “I am determined to tackle this damaging compensation culture which has been pushing up premiums.

“I want to stop trivial claims, free up businesses from the stranglehold of health and safety red tape and look at ways we can bring costs down.”

Downing Street said options for cutting the compensation bill included requiring better evidence and introducing a speed threshold for claims.