Injury claims represent largest claims and costs for liability insurance

The report revealed that the cost of premiums for business liability insurance used by a wide range of businesses had increased by 2% from 2019 to 2020.

The report revealed that the cost of premiums for business liability insurance used by a wide range of businesses had increased by 2% from 2019 to 2020.

Injury claims represent the largest number of claims and costs for employers’ liability and public liability insurance, showed a report released by the Central Bank today. 

From 2015 to 2020, injury claims represented 68% of claimants and 92% of settlement costs.

The report published by the Central Bank today is the second annual employers’ liability, public liability and commercial property insurance report of the National Claims Information Database (NCID).

The report revealed that the cost of premiums for business liability insurance used by a wide range of businesses -- from the smallest of shops to the largest of factories -- had increased by 2% from 2019 to 2020.

This follows a 25% increase in insurance premiums from the years 2013 to 2019 and a 17% decline from 2009 to 2013.

The report also showed that, on average, employers’ liability and public liability claims settled through litigation cost more and take longer to settle than claims settled directly with the insurer or through the Personal Injuries Assessment Board (PIAB).

For injury claim settlements where the total cost of settlement is less than €150,000, making up 93% of claimants, the average compensation costs are relatively similar for claims settled through PIAB and litigation. 

However, when settling claims through litigation the legal fees were found to be, on average, significantly higher at €20,300 per case compared to an average cost of €1,270 per case through PIAB.

Litigation was the most common means of settling employers’ liability and public liability injury claims and accounted for 58% of injury claimants and 81% of injury costs from 2015 to 2020. 

The report found that insurers’ income and expenditure on employers’ liability, public liability, and commercial property insurance had an operating loss of 11% of total income in 2020.

From 2009 to 2020 there has been an operating profit of 3% of total income. While reinsurance arrangements that insurers had in place reduced the operating loss by 12% of total income in 2020.

Package policies made up 84% of policies sold by insurers in 2020. 

Speaking about the findings of the report Mark Cassidy, Director of Economics and Statistics, said: “Insurers made a significant operating loss on the commercial property line, which contributed to an overall operating loss on employers’ liability, public liability, and commercial property lines."

PIAB Chief Executive, Rosalind Carroll said: "We are now in a different environment due to a very sharp fall in numbers of claims since 2020, and the very significant reductions in average awards as a result of the implementation of the Personal Injury Guidelines, which has seen average awards decrease by 42%."