Call for Govt to implement Judicial Council Bill to allow reform of insurance industry

The director of Government Affairs for Insurance Ireland, Declan Jackson, has called on the Government to immediately implement the Judicial Council Bill to allow for the recalibration of personal injury awards.

He was responding to new figures from the Central Bank that reveal the cost of motor insurance claims fell 2.5% between 2009 and 2018, but premiums rose 42%.

The first comprehensive study of premiums and cost claims in Ireland also revealed that insurers made an average of 9% profit last year, all of which appears to cast doubt on industry claims that the higher cost of car insurance is the result of spiralling payouts and increased claims, resulting in low profitability.

Mr Jackson told RTÉ radio’s News at One that the report was very complex and that the industry had worked very hard with the Central Bank to compile the report.

It was necessary to “drill into” the figures and the context behind them such as the fact that the frequency of claims was falling which was masking the cost of personal injury claims, which he said had “rocketed” and was up 64%.

The system has not been reformed since 2004, added Mr Jackson. The Judicial Council Bill, which was designed to address that still hasn’t been commenced.

Personal injury costs had increased from 64% in 2009 to 75% at present, he said. Another issue of concern was the difficulty in the business insurance market, “why are companies leaving? The market is impaired, we need new entrants.

“That’s where the analysis breaks down.”

Sinn Féin’s finance spokesperson Pearse Doherty described the figures as validation of his description of “price gouging” by the insurance industry. The Government was continuing to quote insurance industry figures that claimed premiums were down between 2016-2018 by 27%, when the Central Bank data showed that the figures had gone up 17%.

It was up to the Government to challenge the “propaganda” from the insurance industry, he said. Insurance is far more profitable in Ireland than elsewhere in Europe with the industry making a profit of 9% while in the UK it was 6%, the highest rate in a decade.

“This industry is gouging individuals.”