Fifteen insurance bosses met with Hammond on Tuesday and asked for his intervention following the decision of Chancellor Liz Truss to reduce the discount rate from 2.5% to -0.75%.
According to Evans, Hammond heard “how concerned insurers are about the way this change will hit their customers.”
“It makes no sense to do something that will inevitably pile costs on to motorists, businesses and taxpayers at such a difficult time based on a broken formula,” Evans said.
“It is not too late for the Government to deliver a fairer deal for consumers and claimants and it should commit to urgent reform of the law before this crazy decision becomes a reality.”
Following the meeting, Hammond and the ABI delivered a joint statement, with the government leader promising to consult the industry.
“The government will progress urgently with a consultation on the framework for setting future rates, and bring forward any necessary legislation at an early stage,” the statement read.
According to the statement, the industry will “contribute fully” to the upcoming consultation, while the government will “carefully consider all evidence and arguments submitted.”
“Claimants must get the money they’re entitled to following an injury in order to support their future needs,” Hammond and the ABI said.
“It is important that going forward, personal injury discount rates are set at a level that is fair to both claimants and consumers.”
Among the insurance CEOs who met with Hammond were
Aviva’s Mark Wilson, Direct Line’s Paul Geddes,
Admiral’s David Stevens,
Zurich UK’s Tulsi Naidu,
Allianz UK’s Jon Dye and
AXA UK and Ireland’s Amanda Blanc.
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