Exaggerated compo claims warning

THE Irish Insurance Federation has welcomed recent moves by the courts to make people think twice about making exaggerated personal injury claims.

The Supreme Court on Thursday signalled that those who exaggerate their claims may no longer be treated sympathetically by the courts.

“The landscape seems to be changing,” said IIF non-life insurance manager Michael Horan in response to recent decisions to disallow higher court costs to those who exaggerate their injuries.

“Every little helps,” he said. “Any decisions that remind people that the days of making false and exaggerated claims are over must be welcomed.”

Mr Horan said the reduction by 15% last year in motor insurance premiums had been due to a combination of road safety improvements and a changing claims environment. “Anything that helps to reduce costs is a good thing.”

Mr Horan said the claims environment would be further enhanced next year by the introduction of the Civil Liability and Courts Bill which will require claimants to swear an affidavit in respect of their injuries.

“The Personal Injures Assessment Board will also help tackle legal costs,” he said.

On Thursday, the Supreme Court directed that a Dublin man should pay to Bus Átha Cliath the costs incurred by the company through its having to fight the case he took against them in the High Court.

While the Supreme Court found the claimant was honest, it held that his injuries, which arose when a bus drove into the back of his jeep, did not merit a High Court action.

While it upheld an award of some €20,000 damages to the man, the Supreme Court also decided that he should pay Bus Átha Cliath the costs incurred by the company as a result of defending the case in the High rather than the Circuit Court.

Claims deemed to be worth under €38,000 are generally brought before the Circuit Court. The Superior Court rules and the Courts Act of 1995 both state that costs should only be awarded on the basis of damages received rather than claims made.

However, the courts have, in the past, shown reluctance to limit costs in this manner.

That decision means the man faces a bill for costs, which will greatly exceed the award.

According to legal sources, the decision is a salient reminder to claimants and their lawyers to think twice before taking cases to the higher courts.

The Oireachtas yesterday passed the Personal Injuries Assessment Bill 2003 which establishes the Personal Injuries Assessment Board on a statutory basis. Tánaiste Mary Harney said: “the passing of this bill is a key step in driving the insurance reform programme.”