Insurers must honour pledge to cut costs if awards fall says lobby group CEO

Insurance

10 February 2021

Irish insurance companies “can’t get away from” commitments to the Oireachtas finance committee to pass on savings to customers if the Judicial Council moves to reduce personal injury award guidelines significantly, according to the chief executive of the industry’s lobby group.

The Judicial Council is set to meet on Friday to consider draft guidelines from its Personal Injuries Committee that will recalibrate the level of damages courts can award in personal injuries cases.

The council will publish the guidelines when they are adopted, “whether on the 5th of February or a later date”, according to Kevin O’Neill, interim secretary to the body.

The guidelines, which will come into force by the end of July, will replace the Personal Injuries Assessment Board’s (PIAB) book of quantum as a benchmark for awards. It follows on from a government-commissioned report that found in 2018 that awards for whiplash-type soft-tissue injuries in Ireland are typically 4.4 times higher than in the UK.

“It will be very welcome if there is a meaningful reduction in court awards. It will bring certainty to the market and it will assist underwriters and insurers,” said Insurance Ireland CEO Moyagh Murdock, noting that senior industry executives have told the Oireachtas finance committee that consumers will benefit if awards decline. “They can’t get away from that.”

“There are a lot of consequences hanging off this Judicial Council report. It should bring about a significant change to the whole injury claims process in this country and the cost of insurance,” she added.

Top executives from general insurers including FBD, Allianz, Axa, Aviva and Zurich told the Committee in 2019 that their companies would reduce premiums if the Judicial Council delivered on hopes and reduced personal injury award guidelines.

The Alliance for Insurance Reform has called on the judiciary to “have regard to the common good” in their deliberations and reduce awards for minor personal injuries by 80 per cent.

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