Labour ambulance chasers: who cares?

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We all know there have been some dodgy dealings where insurance companies make a small fortune from referring accident victims to ambulance chasing lawyers - which in turn means we are paying more for our motor insurance. One newspaper has revealed the shocker that the Labour Party is also in on the referral fees gravy train.

But does it really matter?

The Labour Party money spinner

The Daily Mail is reporting that the Labour Party is making £250 plus VAT for every member it refers on to a firm of lawyers. The members in question are those who use the Party's legal services offering. If a member goes onto use the legal firm it links to, the Labour Party makes its money.

The report highlights that part of the massive hikes in motor insurance costs have been because of the work of the ambulance chasers, who are said to add £150 on average to a policy.

Justice Minister Jonathan Djanogly was quick to condemn the service, saying: "Hard-working people are paying the price for Labour's shameful insurance racket. It is no wonder that Labour won't fully back our proposals to abolish referral fees when they are exploiting the current system to fill their own party coffers at everyone else's expense."

The paper then goes on to highlight that Labour has taken £355,629.43 in donations from companies offering these sorts of services since 2001.

Do we care?

So we should be shocked and appalled, right?

Well. it depends. What we're talking about here is Labour Party members searching for someone to help them with a compensation case and being directed towards the fastest-growing legal firm in the UK. It's not that they are victims of accidents who will suddenly receive an unwanted cold call. They actually set out to find this sort of service.

A Labour spokesman said: 'In common with many voluntary organisations, the Labour Party offers a number of benefits to members."

This is surely a fair distance from being a 'shameful insurance racket'.

And on the subject of ambulance-chasers pushing up insurance premiums. That's certainly true, but the main reason that premiums are rising is because insurance companies are trying to make a profit on motor insurance policies for the first time in years.

Typically they don't make any money on this at all, especially in the first year. Now they have to try because people switch more, so they find themselves offering discounts to hook people in, and then losing them after the discount comes to an end.

In addition, previously they have always relied on investment money to balance the books. It's the collapse of interest rates and investment returns that are at fault here, and there's no way you can blame the ambulance chasers for that.

Dangerous policy

Of course, if there's one things that politicians should know by now it's that it's essential to consider how things appear. Should they really be making money from offering controversial services? The Party is clearly in need of cash, but is there nowhere else to turn before it falls back on something so frequently in the headlines?

Every political party could stand to take a long hard look at the companies and individuals they take money from and consider whether they need the money badly enough to put up with the headlines they may face when the money-making and donations come to light.

The trouble is that the parties are in such dire need of cash that there's a good chance they'll continue to take it wherever they can get it for the foreseeable future.

But is this any way for politicians to behave? What do you think? Let us know in the comments.
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