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May 8, 2008

How a small knock can become a major accident

IN 2004, the car that my wife was in was gently bumped from behind (she was waiting at the entrance of the carpark). As it was a small knock, both parties agreed to settle via our individual insurance policies. Two interesting things happened.

1. The other party painted a totally different scenario – different location, different circumstances, etc. In this scenario, my wife, on a main road, recklessly swerved into the other car’s path and, hence, was hit from behind.

2. The more interesting part was a call I received from my workshop’s lawyer. He asked me whether my wife was all right. I said that it was a slow-speed/low-impact bump, but he said: ‘You know, even small knocks from behind can cause ‘whiplash’. Moreover, since my wife was a tutor, she could claim ‘loss of income due to pain afflicted while being sedentary’.

I insisted that she was fine, but the lawyer then proceeded to advise me to visit his ‘recommended orthopaedic specialist’ who has been ‘very effective’ in confirming such ‘latent whiplash’ injuries for his law firm. He even told me the doctor would waive his consultation fees. I was informed that the damages could come to tens of thousands of dollars.

We did not take him up on the offer, but imagine how such actions could inflate the costs of insurance.

About the Author

Ivan Guan is the author of the popular book "FIRE Your Retirement". He is an independent financial adviser with more than a decade of knowledge and experience in providing financial advisory services to both individuals and businesses. He specializes in investment planning and portfolio management for early retirement. His blog provides practical financial tips, strategies and resources to help people achieve financial freedom. Follow his Telegram Channel to join the FIRE community.
The views and opinions expressed in this article are those of the author. This does not reflect the official position of any agency, organization, employer or company. Refer to full disclaimers here.

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