With new information coming to light that it has been accepting referral fees for accident claims, the Labour party may be partly responsible for the high car insurance rates that are a byproduct of the referral fees.
The party stands accused of taking hundreds of thousands of pounds from personal injury lawyers who seek out those who have made motor car insurance claims, as it has been revealed that these solicitors pay ‘£250 plus VAT’ every time a Labour supporter is referred to one of these solicitor firms. Party officials have also been accused of receiving in excess of £350,000 through direct donations from ‘no win no fee’ accident claim lawyers.
Ministers accused the party of contributing to the ‘racket’ of referral fees, as these fees contribute to the death of discount car insurance. Some experts have estimated that a blanket ban on referral fees could end up saving motorists as much as £150 on their annual insurance premiums.
Taxpayers also suffer when councils are sued by individuals having accidents in public places or falling over in the street. Yet while people are encouraged to file more and more spurious claims by ‘ambulance chasing’ solicitors and the public foots the bill, Labour stands accussed of stuffing its coffers with referral fees paid to them by solicitors.
This has led the Tories to claim this is the true reason Labour has refued to back referral fee abolition plans. The accusations stem from Labour Legal Services, an official party website, which has a personal injury section that guarantees claimants maximum compensation rewards on any claims they make, urging those involved in car accidents and other kinds of injuries to make use of their services.