Fleet News

Accident compensation rise to hit fleet insurance premiums

FLEET insurance premiums will face inflationary pressure as the Government sharply increases the compensation that hospitals can seek for treating road traffic accident victims.

The Department of Health plans to raise the amount that hospitals can recover from accident victims by 14% to £402 per day (from £354) for treatment without admission to hospital, and to £494 per day for treatment with admission (from £435).

In addition, the maximum sum that a hospital can recover from treating an accident victim will rise to £30,000 from £10,000.

'There has been no increase in the tariff or ceiling charges since the scheme started nearly three years ago,' said Hazel Blears, parliamentary undersecretary of state at the Department of Health. 'However the Department is planning to increase the tariff in line with hospital and community health services inflation and increase the ceiling of charges.'

Hospitals have become much more proficient in recovering these costs over the past three years since the introduction of a centralised collection service in April 1999.

This coincided with a Law Commission ruling that the NHS should have the right to recover its costs in all cases where a personal injury compensation payment was made.

The hospital fees are paid by the insurer of the guilty party in a road traffic accident, and are placing serious inflationary pressures on vehicle insurance premiums.

Official figures reveal that in the first year of its operation the NHS compensation recovery unit recovered £26.4 million.

'The following year (2000/01) £67 million was recovered for NHS trusts in England,' said Blear.

And in the eight months between April and November 2001, the compensation recovery unit recouped £58.9 million.

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