New guidelines see personal injury award values drop by 40% since April

A report from the Personal Injuries Assessment Board (PIAB), shows that 18% of awards are now under €5,000, while 30% are now between €5,000 and €10,000. Picture: Pexels

Personal injury awards have reduced by an average of 40% since the introduction of the new injuries guidelines in April.

A report from the Personal Injuries Assessment Board (PIAB), shows that 18% of awards are now under €5,000, while 30% are now between €5,000 and €10,000.

This shows that nearly half (48%) of all personal injury claims are now coming in under €10,000, compared to just 12% of awards previously.

Average awards by PIAB reduced from April 27 up to the end of September from €23,877 to €14,233, an average reduction of €9,654 per award, with a total reduction in award values of €25.6m.

The research was based on more than 2,600 assessed claims, with PIAB, the main implementer of the guidelines, saying it has shown the vast majority of claims never reach the courts, less than 4%.

The report differentiates between general damages, such as pain and suffering, and special damage which include direct costs to claimants such as loss of earnings, the latter of which are unaffected by the new guidelines.

It shows that the average award for general damages has decreased by 46%, while also highlight the drop in the rate of acceptance of PIAB awards by claimants to 41% from more than 50%.

Rosalind Carroll, PIAB chief executive, said the report is "good news" for individuals, communities and businesses as personal injury claims have been an important factor in the price and availability of insurance.

“It will take some time to see the full effects of the guidelines, particularly in respect of savings in legal costs and litigation," Ms Carrol said.

"Transparency in the area is critical to the success of the guidelines and insurance reform, which is why PIAB have produced this report today and will continue to provide regular reports on our data."

She added: “Reductions in award levels create the perfect environment for a reduction in insurance premiums.

"Combined with the overall sharp reduction in the number of injury claims in the last 18 months, this report shows that overall claim costs are falling very significantly.”

The Alliance for Insurance Reform welcomed the report from PIAB but said the findings will be of no value unless they lead to substantial reductions in insurance premiums.

Peter Boland, director of the Alliance said: "While we are seeing some downward movement in motor insurance premiums, the experience of SMEs, voluntary & community groups, sports and cultural organisations and charities is that renewals are actually increasing right now. 

"Why aren’t they falling?"

"If the savings in PIAB settlements do not go into reductions in unaffordable premiums, they go directly into insurers’ profits.”

Mr Boland added: “The insurance industry cannot have its cake and eat it."

The Alliance are now calling for full transparency from the insurance industry.

“PIAB and the Courts account for a small proportion of settlements and it is vital that insurers, who finalise the vast majority of them, provide data this year to confirm whether or not they are holding firm on the new judicial guidelines," Mr Boland said.