The government will put an injunction on the recommendation fees, as it believes that these recommendation fees sometimes result in fake claims and increasing insurance costs.

According to Justice Minister Jonathan Djanogly, the structure of ‘no-win, no-fee' result into a huge profit for the middle men and the other two parties pay either due to high insurance premiums or elevated charges.

The consumer regulators had earlier notified that the referral procedures have encouraged the average premium charges which have increased by nearly 40% in a year.

Most of the motor insurers have been facing huge loss due to the false claims and on the other hand, the lawyers make the money between 2,500 pounds and 750 pounds for those referrals.

Referral fee becomes the icing on the cake for the lawyers with a no-win, no-fee assertion and the lawyers make a huge amount of money by asking the accused party or the insurance company for the winning attempt.

Mr. Djanogly stated that people receive encouragement for suing the other party in all the sectors be it education, and business and each individual can be heaved to court for not committing any mistake.

UK French insurer Axa CEO Paul Evans stated, "This is an important step in curbing the compensation culture which has been instrumental in inflating motor insurance premiums".