Insurance: New accident insurance laws `will penalise motorists'
Wednesday 09 December 1998
While the Secretary of State for Health acknowledged that the Association of British Insurers had estimated premiums could rise by up to pounds 9 per policy if the full charge was passed on, he said the industry would have had nearly two years to adjust by the time the changes became law next year.
Opening the second reading debate on the Road Traffic (NHS Charges) Bill, Mr Dobson dismissed accusations of big increases in insurance premiums as "untrue scare stories". But Ann Widdecombe, the Shadow health secretary, said the Government was determined to "penalise motorists" after parallel rises in fuel and vehicle excise duties.
Challenging Mr Dobson over who would pay for uninsured motorists, she added: "This legislation will be a double-whammy for everyone who is prudent enough to take out a motor insurance because as law-abiding citizens they will be charged twice."
Mr Dobson insisted the charges were not new because insurers had been liable since 1930 and the current collection system was a "shambles".
"We are just making sure that in future NHS hospitals get the money to which they have been entitled for the last 68 years."
The switch to a central "recovery unit" to collect the money direct from insurance companies could net up to pounds 165m for hospitals in Britain, the Health Secretary claimed.
"The new scheme will bring order out of chaos. It will not place a large burden on motorists or insurers.
"It is a sensible, practical measure that will raise much needed extra funds for hospitals in every part of the country," he added.
Mr Dobson said the NHS was losing substantial amounts of money because the present system for collecting the charges, combining "minimal income with maximum inconvenience", had failed.
Last year it raised just pounds 16m, with NHS staff forced to ask injured motorists for an emergency treatment fee in the aftermath of a crash.
Under the Bill, the right of NHS hospitals to levy an emergency fee will be abolished and a tariff of charges will be introduced instead for the recovery unit to call up in the case of an accident and pursue with insurers.
There will be a flat rate fee of pounds 354 for those who did not need to stay in hospital, and a daily charge for those needing to stay in hospital of pounds 435, with a maximum ceiling in any one case of pounds 10,000.
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