Insurance advocates call on Government to help reduce premiums

The Alliance for Insurance Reform said the reduction in personal injury awards is 'not being reflected in liability premiums'

According to data from the Courts Service, in 2022 the value of awards handed out by the District Courts, Circuit Courts, and the High Court fell by approximately €36m compared to 2021.

The Alliance for Insurance Reform has called on the Government to take action on high insurance premiums despite recent data from the Courts Service showing a reduction in personal injury compensation being awarded by the courts. 

However, Jennifer Carroll MacNeill, Junior Minister with responsibility for insurance, said laws relating to public liability insurance were changed in July, which should bring down premiums for business, but they will take time to bed in. 

In April 2021, the Judicial Council's Personal Injury Guidelines were introduced which replaced the Book of Quantum when assessing awards for personal injury claims.

According to recent data from the Courts Service, in 2022 the value of awards handed out by the District Courts, Circuit Courts, and the High Court fell by approximately €36m compared to 2021.

In addition, during 2022 the number of awards made in Circuit Courts dropped to 57% of 2019’s volume and 58% of the value while the District Court awards increased in volume by 14% but decreased by 10% in value.

District Courts hear cases with claims up to €15,000 while the Circuit Court hears cases with claims up to €60,000. In the High Court, the average dropped to €120,042 last year from €135,934 in 2021. The highest amount awarded in 2022 was €19m compared to €30m the year prior.

However, despite the reduction in the awards, Flora Crowe, Alliance board member, said that is “simply not being reflected in liability premiums”.

Ivan Cooper, chief executive of charity representative body The Wheel and Alliance board member, said the Judicial Guidelines have been beneficial in terms of reducing awards but they weren’t introduced “solely for the benefit of insurance companies”.

He said the millions of euros these companies have been saving as a result of the guidelines “should be shared with small businesses, voluntary and community groups, sports and cultural organisations and charities right across the country”.

“The Government needs to do more,” Mr Cooper added.

The Alliance comprises civic and business organisations around the country and seeks to highlight the negative impact of persistently high premiums.

Ms Carroll MacNeill said the reductions seen in the Court Services data is mainly due to a reduction in motor insurance claims for which premiums have come down since their peak.

In July, laws were changed around the duty of care and how it impacts public liability insurance. Ms Caroll MacNeill said Ireland had been a “wild outlier” in Europe in terms of the “onus of responsibility” on businesses.

Ms Carroll MacNeill said they anticipate this change will reduce premiums for businesses but “it is going to take a period of time to bed in”.

“The legal change only took effect in July, so we’re talking about prospective premiums… The real impact of the change is going to take 12, 18, 24 months to bed in, in a similar way to the motor insurance premium changes.” 

“I will be holding the insurance companies' feet to the fire on this,” she added.