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The Irish Sun
06-07-2025
- Business
- The Irish Sun
Stealth hike in Irish personal injury insurance payouts will hit us all in the pocket – Govt's timing couldn't be worse
INSURANCE premiums are another rising cost in Ireland's affordability crisis, with prices outpacing those in many other European countries. The average cost of 3 The rises can cause real world problems for many people Credit: Getty Images - Getty 3 Minister for Justice Jim O'Callaghan Credit: Alamy 3 Brian Hanley said prices outpace those in many other European countries Credit: social media collect - IVAN COOPER That's almost double the price of the average And there are fears they could shoot up even more, as the proposed personal injury award guidelines are to be increased by almost 17 per cent. These rises can cause real world problems for many people. It could mean driving less or taking Small READ MORE IN OPINION Justice Minister Brian Hanley of the Alliance for Insurance Reform, says the timing of an increase in personal injury awards couldn't be worse for policyholders. IF you are a motorist, small business owner, The Most read in The Irish Sun Now, in the middle of this affordability crisis, the Government is preparing to quietly make things even worse. A proposal is set to be brought to Cabinet to increase personal injury awards by nearly 17 per cent, reversing much of the progress made over the past three years to bring a degree of balance and consistency to injury compensation in Ireland. HIGHER THAN ENGLAND Nobody disputes that people who suffer injuries deserve fair compensation, but Irish awards are already among the highest in Europe. A 2019 analysis by the Personal Injuries Commission showed personal injury awards here were 440 per cent higher than those in That kind of disparity isn't fair — it's unsustainable. The move comes as the latest Central More claims and rising repair costs — driven by inflation — have already pushed up the cost of cover. The one factor helping to contain those costs was a reduction in injury awards. Now, that progress risks being undone. This is especially concerning for Tracy Sheridan, who runs Kidspace play centres in Rathfarnham and Rathcoole and is a board member of the Alliance for Insurance Reform, sees the effect first-hand. HARDER TO KEEP GOING She says: 'Every month we're hearing about premiums going up. The only bright spot had been that awards had come down. If Government raises them now, there'll be no brake on rising insurance costs. It's just not sustainable.' And it's not just businesses feeling the strain. Across the country, voluntary groups, sports clubs and community organisations — many operating on a shoestring — are finding it harder and harder to keep going. They're doing everything right: improving safety, reducing risk, keeping clean records. Yet when the insurance renewal comes around, the premium has risen again. Here's the kicker: for liability insurance, which covers injuries that happen in places like community centres or sports pitches, the cost of claims has actually gone down — by ten per cent in the same six-month period. In a properly functioning market, that should lead to lower premiums, but that hasn't happened. What's worrying is how little public discussion there's been about this planned increase. The Government has been virtually silent for six months, even though this change affects every single policyholder in the country. There's been no proper scrutiny from the In 2021, new Personal Injuries Guidelines were introduced to bring more consistency and fairness. They helped align Irish awards more closely with international norms. FOOT THE BILL Those reforms were a step in the right direction — but they are now at risk of being reversed before they've had a chance to deliver lasting impact. The Central Bank's report makes another key point: legal costs blow up when claims are settled through litigation instead of the Injuries Resolution Board. For liability claims under €100,000 — which account for 94 per cent of all personal injury cases — legal fees go from just €597 at the Injuries Board to over €24,000 for claims settled in litigation. The average award for claimants is actually the same, so you're left asking who really benefits from almost 70 per cent of cases going into litigation? Not claimants and certainly not policyholders. It's the public — motorists, business owners, The Government must now pause this proposal and refer it to the relevant Oireachtas committee. We need transparency, data, and evidence — not quiet decisions made behind closed doors. Let's debate the facts, consult the experts and hear from the people who are paying the premiums. Because if insurance keeps going the way it is going, the damage won't just be financial — it will be social and structural. Ireland needs a personal injury system that is fair for claimants, and affordable for everyone else.
Irish Independent
01-07-2025
- Business
- Irish Independent
Lawyers ‘will be real winners' if plans to hike injury awards get green light
The Alliance for Insurance Reform said the proposed rise in award levels would send premiums up for consumers, businesses and community groups. Small business lobby group Isme (Irish Small and Medium Enterprises Association), called on Justice Minister Jim O'Callaghan not to support an increase in the scale of personal injury awards. Approving the rise would be a capitulation to vested legal interests, it claimed. Isme said the increase would lead to rises in insurance premiums for both businesses and consumers and 'would take money directly from small businesses and into the pockets of lawyers'. The Judicial Council has proposed that personal injury award guidelines should be increased by almost 17pc. It is understood Mr O'Callaghan is to bring a memo to the Cabinet next Tuesday, paving the way for draft legislation that would give effect to a planned rise in award levels. It comes at a time when car insurance premiums have risen for 21 months in a row, having fallen heavily up to 2022. Three-quarters of small businesses, sports, community and voluntary groups have seen their insurance premiums rise over the last two years, despite government reforms, the Alliance for Insurance Reform reported last week. The proposal from the judges comes despite the fact that the recommended payout for minor neck injuries, where recovery is made within six months, is already up to five-and-a-half times higher than in the UK. Alliance chairman Vincent Jennings, who is also chief executive of the Convenience Stores and Newsagents Association (CSNA), said lawyers would be the winners if recommended award levels rise. Insurance campaigners fear that higher award levels will incentivise lawyers to try harder to keep cases out of the State's Injuries Resolution Board process, which generally does not pay legal fees. Injury claims cases that proceed to litigation end up with legal fees averaging €23,000, according to Central Bank research. This is despite the fact that award levels paid by the Injuries Board and those achieved when cases are litigated, or settled before a court hearing, are all similar. Close to half of the settlement offers made by the Injuries Board are rejected. It said recently that 95pc of claimants using its services are represented by a solicitor. The fact that it does not pay legal fees means people often reject its settlement offers, the submission states. 'It is astonishing that at a time when premiums are rising month on month, and we already pay higher awards than any other European country, the Government looks set to approve an increase of 17pc in personal injury awards,' Mr Jennings said. He said such an increase is certain to raise insurance premiums and shows 'a worrying lack of awareness or, worse still, indifference to the ongoing financial challenges motorists, small business owners, voluntary, community and sporting organisations face'.
Irish Independent
16-06-2025
- Automotive
- Irish Independent
Insurance brokers accused of ‘inherently unfair' commission structure that favours higher premiums
The Alliance for Insurance Reform has questioned why most insurance brokers charge a fee that is based on a percentage of the cost of a policy. It claimed that the higher the premium a broker will secure for a consumer from an insurer, the more money the broker will make in commissions. It said broker commissions account for 'an increasing proportion of the overall cost of insurance'. It said other professions are precluded from charging a fee based on a percentage of the product or services and said this is something that also needs further examination. In a submission to the Department of Finance, as part of the public consultation on a new Action Plan for Insurance Reform, the Alliance for Insurance Reform said: 'Many brokers now charge a fee based on a percentage of the cost of the policy. This is inherently unfair to consumers as the 'worse' the premium they secure for them, the more money they will make.' The Alliance called for a detailed examination of the brokerage market in Ireland to be carried out, with strong consumer input. Commissions paid to brokers for selling motor insurance were 14pc of the premium in 2023, according to the Central Bank of Ireland's 'Private Motor Insurance Report', issued last October. A separate Central Bank report found the average motor premium is now €616. This means brokers earn €86 on the average motor premium. Both motor and home insurance costs have been rising now for months. Asked for a response, Brokers Ireland, which represents the sector, said the claim that brokerage charges account for 'an increasing proportion of the overall cost of insurance' lacks a clear evidential basis. It said the Central Bank's Consumer Protection Code mandates full disclosure of fees and commissions at the point of sale. Brokers Ireland said consumers are fully informed of how brokers are remunerated. 'Furthermore, insurance brokers typically work to reduce overall insurance costs for consumers by sourcing the most competitive and appropriate cover,' it said. It said the suggestion that percentage-based commissions are 'inherently unfair' misrepresents how insurance intermediation works. 'Commission-based models are a long-standing and internationally accepted form of broker remuneration, aligned with the interests of consumers,' it said. 'Insurance brokers are incentivised to deliver appropriate cover, value for money and ongoing service – all of which drive client retention and trust.'
The Journal
07-05-2025
- Automotive
- The Journal
Motor insurance premiums increased by 9% in first six months of last year
MOTOR INSURANCE PREMIUMS increased by 9% in the first six months of last year, according to new research by the Central Bank. The average cost of insuring vehicles like cars, motorbikes and vans was €616 between January and June 2024. It is one of the largest costs recorded by the banking regulator in recent months and puts an end to a trend of price cuts . This is despite new personal injury claim guidelines being introduced in 2021 to reduce the cost of insurance premiums across the board. Advertisement Today's figures also reveal that there were 24,000 more policies created in the first six months of last year compared to the last six months of 2023. This grossed approximately €729m in written premuims to companies, the Central Bank report says. Brian Hanley, CEO of the Alliance for Insurance Reform, says the increases in premiums has been driven by inflation and the increasing cost of vehicle parts. He said that the government must consider methods to reduce costs for people seeking to insure cars. Hanley has urged the justice minister Jim O'Callaghan to reject a recommendation by the Judicial Council to increase personal injury pay outs because, he claims, this will fuel further increases in insurance costs for policyholders. Today's report is part of a twice-yearly analysis of the Irish motor insurance industry which considers data from roughly 98% of the market. A total of 13 companies operating in Ireland submitted information the report. Readers like you are keeping these stories free for everyone... A mix of advertising and supporting contributions helps keep paywalls away from valuable information like this article. Over 5,000 readers like you have already stepped up and support us with a monthly payment or a once-off donation. Learn More Support The Journal
Irish Independent
07-05-2025
- Automotive
- Irish Independent
Motor insurance premiums up 12pc in just two years as average cost revealed
The average premium is now €616, a rise of €67 since 2022, new data from the Central Bank shows. This is an increase of 12pc in the last two years alone. The sharp rise comes despite the Government introducing a number of reforms in an attempt to bring down the cost of insurance for motorists. Among the most significant of these was the agreement by judges to lower the recommended level of payouts in personal injuries cases, and changes to how the Injuries Resolution Board (IRB) operates. A dedicated garda insurance fraud unit has been set up, with changes to duty-of-care legislation, making it harder for those exaggerating compensation claims to get a payout. The Alliance for Insurance Reform, a campaign group, said the premium hikes called into question recommendations from judges to increase the size of damages awards. The Judicial Council has recommended hiking personal injury award guidelines by 16.7pc. This needs to be confirmed by the Government. The mid-year National Claims Information Database (NCID), which is compiled by the Central Bank from data provided by insurers it regulates, shows motor premiums were up by 9pc in the first half of last year. This is when compared with the same period of 2023. How can the Government justify taking steps that will drive the cost of people's car insurance even higher? The report shows a rise of just 1pc in the number of comprehensive policies. Insurers have cited more people taking out comprehensive cover as one of the factors for the continuing rise in motor premium costs. The report found 1.2 million motor policies were taken out in the first half of last year. Gross written premiums for these totalled €729m, and 93pc of the policies were for comprehensive cover. ADVERTISEMENT The Central Bank report shows that the average written premium was €616 in the first half of last year. This is up from €549 in the second half of 2022, but it is down from €729 in the second half of 2018, after various Government measures brought down the cost of claims. Brian Hanley of the Alliance for Insurance Reform, said the Central Bank report shows a sharp rise in motor insurance premiums of 9pc in the first six months of last year. 'Set against this, how can the Government justify taking steps that will drive the cost of people's car insurance even higher?' he said. He added that if adopted, the 17pc increase in personal injury awards will lead directly to even greater increases in car insurance premiums. Motorists, businesses, sporting, community and voluntary groups simply cannot afford for this to happen Mr Hanley said Justice Minister Jim O'Callaghan, who is currently considering a recommendation from the Judicial Council that personal injury awards be increased, needs to consider injury awards in this country are higher than in other states. 'Notwithstanding that awards are higher here than in most other countries, and the relatively short time the current award guidelines are in existence (2021), if adopted it will lead directly to even greater increases in policyholder premiums,' Mr Hanley said. 'Motorists, businesses, sporting, community and voluntary groups simply cannot afford for this to happen.' Lobby group for the industry, Insurance Ireland, said premiums were rising due to damage-cost inflation. It added that current average premium costs remain below the previous high point of €729 in 2017. But it said the trend of increased damage claims costs continues, while the use of litigation to settle personal injury claims continues to erode the impact of reforms. Insurance Ireland CEO Moyagh Murdock said: 'Although premiums have begun to increase, reflecting the increased cost environment, Irish motor insurance customers have benefited from significant decreases.' She said the trend of settling claims via the more expensive litigated route continues to add huge costs, despite the fact it doesn't add to the levels of awards the claimant receives via either the IRB process or directly settling claims with insurers.
