This week I attended a summit in Downing Street, chaired by the Prime Minister, to agree action to tackle the rising cost of car insurance premiums. One of the main causes has been a problem which bedevils today's society - the compensation culture.
Unjustified litigation has been fuelled by the proliferation of ‘no win, no fee' cases. Spurious compensation claims can be brought to court far too easily and with no financial risk to the claimant. A rash of advertising has encouraged people to claim.
The only winners have been the lawyers. Britain is now the whiplash capital of Europe, with more than 1,500 claims a day from people claiming for whiplash injuries sustained in the most minor of incidents.
According to the Association of British Insurers, the cost to the industry from whiplash claims is £2 billion, adding £90 to the average premium.
The Government is already acting by reforming 'no win no fee' arrangements and abolishing referral fees in which insurance companies sell personal injury details to ambulance-chasing claims firms.
At the summit the Government and insurance industry committed to work together to identify additional ways to reduce the number and cost of whiplash claims. Options include improved medical evidence and a cost threshold for claims.
The Government has also pledged to reduce the £1,200 fee that makes these cases lucrative for compensation lawyers. Crucially, the insurance industry has agreed to pass these savings on by reducing premiums.
The summit also agreed to to look at what more can be done to tackle the huge insurance premiums faced by younger drivers. The average premium for a young male driver is now nearly £3,000.
Younger drivers could volunteer to have a "smart box" fitted to their car to monitor the way they drive and prove to insurers that they deserve a lower premium.
In rural areas like the South Downs, cars are an expensive necessity. The Government has already frozen fuel duty and cracked down on uninsured driving, which puts at least £30 on the price of each premium.
Tackling the compensation culture is another way to lower premiums and help families with the costs of motoring.