The government will crack down on fraudulent whiplash claims and reduce motor insurance premiums, it was announced in the Queen's Speech this morning.
The Civil Liability Bill was announced and is expected to reduce annual motor premiums by about £35 per year.
The proposed legislation follows plans consulted on at the end of last year to get tough on bogus whiplash claims.
The Queen said: "Legislation will also be introduced to modernise the courts system and to help reduce motor insurance premiums."
Motor insurers welcomed today's announcement. Axa UK chief executive Amanda Blanc said: “It is really encouraging to see the government taking whiplash fraud seriously.
In a speech understandably dominated by Brexit matters, the inclusion of the Civil Liability Bill just goes to show how important it is that the UK's compensation culture is tackled.
Last November, former justice minister Liz Truss revealed a consultation on government plans to "crack down on minor, exaggerated and fraudulent claims".
Steve Treloar, LV's general insurance managing director, said: "The original proposals from government on tackling whiplash didn’t go as far as we felt was necessary so we’re pleased that they are now committing to making the changes that we’ve long been asking for."
However, Blanc highlighted there was no specific reference to reforming the Ogden rate, the discount rate applied to personal injury claims.
She said: "We need to use this opportunity to also consider the impact of the Ministry of Justice’s decision to reduce the personal injury discount rate to minus 0.75 per cent which is not representative of real investment practice and has put severe pressure on people’s premiums and the NHS.
If the rate is left as it is, it will more than cancel out any savings delivered by whiplash reform.
Meanwhile, personal injury lawyers lamented plans for a Civil Liability Bill. First4Lawyers managing director Qamar Anwar said the plans were "disappointing, although not surprising", labelling the idea motorists will save £35 per year "fanciful".
I have a better idea for passing on £35 to every motorist: when it comes to renewal time the industry could cease their annual premium hike charade designed to get time-poor individuals to stump up more cash and instead just give the real price.