Latest news with #PersonalInjuriesGuidelines
Irish Independent
3 days ago
- Business
- Irish Independent
Transparency about where money goes can help get a grip on insurance costs
The open consultation process that informed this plan is a model for how policy reform should be approached, enriched by diverse perspectives, with over 70 submissions focused on outcomes that benefit consumers, businesses, and the wider economy. The plan sets out a structured schedule of actions and is built around six core themes, which reflect a comprehensive approach to reform. The emphasis on legal reform, innovation, and affordability aligns well with the challenges facing the sector. It is also encouraging to see 10 priority actions, which target the most pressing issues. The plan's emphasis on enhancing the efficiency, authority, and impact of the Injuries Resolution Board (IRB) is welcomed. Action 3 is a priority reform aimed at reducing litigation, lowering costs, and improving the speed of claims resolution. Preventing claimants from modifying their claims post IRB and introducing legal costs for its claims are pragmatic steps that will encourage early resolution and discourage unnecessary litigation and delays. This will promote consistency in how injuries are assessed as currently, the IRB and the court are effectively assessing different cases due to the introduction of additional reports for those claims going into court. This has prevented the IRB from reaching its full potential. Another positive step is the commitment to report on accepted IRB assessments, rather than just those issued, half of which are typically rejected. This will enhance transparency and support future improvements. Action 4 proposes benchmarking Irish injury awards against those in the UK and other European countries. This raises questions, as similar analysis was believed to have informed the 2021 Personal Injuries Guidelines. Insurers are now compiling data to support this work. While the focus is currently on the UK, it's vital that the scope includes European jurisdictions with less prevalent compensation cultures. These systems offer valuable insights into achieving fair compensation while maintaining market sustainability. It's been over 20 years since the Troika identified Ireland's high legal costs as a barrier to competitiveness. Yet legal fees remain a major driver of insurance premiums. The development of legal cost scales under Action 6 is long overdue, having first been proposed in the 2020 Action Plan. Although scoping was completed in June 2022, further progress was deferred pending sufficient data on the impact of the Judicial Council's Personal Injuries Guidelines, likely in the hope that reduced awards and litigation would lessen the need for further reform. However, legal costs remain a persistent issue. According to the 2024 National Claims Information Database (NCID) mid-year report, motor injury claims under €100,000 that settled through litigation saw legal costs rise on average to €18,859, compared to just €836 through the IRB, some 22 times higher. These costs now represent 94pc of the average compensation award and 48pc of the total claim spend in the litigation channel. While average compensation has fallen by 17pc, the total cost per claim has only decreased by 1.6pc, meaning the benefit of lower awards has been largely offset by rising legal fees. Similarly, tougher penalties and enhanced intelligence sharing on fraud in Action 12 would help protect honest policyholders and restore trust in the system. Further investment in the Garda Fraud Bureau will be key to ensuring the success of this initiative. Action 21 proposes amendments to the Judicial Council Act that could extend the review period for the guidelines from three to seven years. The current review cycle is too short to allow reforms to take root, contributing to instability and unpredictability, which are precisely the issues the guidelines are meant to address. These changes, along with mandated consultation with the IRB in the review process and clearer Oireachtas oversight, will help ensure that the guidelines remain relevant and balanced. While proposals such as the introduction of pre-action protocols and case management in personal injury claims have not been prioritised in either the 2020 or 2025 reform plans, they have the potential to deliver significant impact. Pre-action protocols encourage early resolution of claims and reduce the need for litigation. Where court action is necessary, structured case management would ensure claims are handled efficiently. Together, these measures could help reduce legal costs, speed up outcomes, and ease the burden on all parties involved. Learn more Insurance reform is not a one-time fix. It's an ongoing process that requires persistence, adaptability, and more importantly, collaboration between government, industry, legal professionals, and consumers. The new Action Plan offers a strong foundation. It reflects a shared commitment to change and a recognition that lasting progress only happens when insurers, policymakers, legal professionals, and consumers work together. Lisa Dennehy is chief claims officer at Aviva Insurance Ireland DAC
Irish Independent
09-07-2025
- Automotive
- Irish Independent
Injuries Resolution Board saved claimants €76m in legal costs last year while awarding €168m in compensation
The IRB, the state body that allows people to resolve personal injury claims without incurring legal costs, said €76m was saved. It awarded €168m in compensation last year, it said, after releasing its annual report for 2024. For the most part, the IRB does not pay legal costs, despite most claimants using it being represented by a solicitor. It said it had 20,837 claims last year, up 3pc on 2023. This was 33pc lower than the 2019 level. It attributed the 3pc rise to the fact that last year was the first full year in which Garda Compensation Scheme claims came under its remit. The huge fall in the number of payouts approved by the board last year compared with 2019 is largely due to the near 40pc drop in the average value of personal injury awards after the Personal Injuries Guidelines were introduced in 2021. A proposal from judges to increase the award levels by 17pc was referred by the Cabinet yesterday to a sub-group on insurance reform. The €168m paid by the IRB last year was down 39pc from the 2019 figure of €275m. The typical, or median, award was €13,100. This is up 12pc on 2023, but 29pc lower than in 2020. Acceptance rates, where both parties agree to an IRB assessment, grew again, to 50pc last year, up from 48pc in 2023. If a settlement offer from the board is not accepted by the claimant or the insurer, it goes to litigation unless it is settled by the insurer. The median motor liability award agreed by the board last year was €12,500, down €5,400 on the 2020 figure. The IRB, formerly known as the Personal Injuries Assessment Board, deals with road traffic, public liability and workplace personal injury claims. The longer a claim lasted before being resolved, the higher the legal fees Most claims have to go to it first, and can go to court only if an assessment by the IRB is rejected by either side. The longer a claim lasted before being resolved, the higher the legal fees, the board said. Enterprise Minister Peter Burke said the annual report demonstrates how the IRB's model continues to deliver significant benefits. 'I want to commend the board for its ongoing work, which last year alone generated savings of €76m in avoided legal costs,' he said. IRB chief executive Rosalind Carroll said that in the 20-year existence of the board, 'more than €1.2bn was saved in avoided legal costs as a direct result of claims being resolved through the board, with €76m alone saved in 2024'. She said the IRB exists to offer an alternative to litigation to provide a fair, impartial, non-adversarial route to resolve injury claims. The Alliance for Insurance Reform welcomed the fall in the number and value of claims, but said policy-holders were not benefiting from this.
RTÉ News
03-07-2025
- Automotive
- RTÉ News
Cost of settling motor insurance claims increased 23% in the first half of 2024
There was a 23% increase in the cost of settling motor insurance claims during the first half of last year compared to the second half of 2023, according to latest figures from the Central Bank's National Claims Information Database (NCID). It shows the cost of motor claims settled between January and June 2024 was €414 million, with the Central Bank attributing the higher cost to an increase in damage claims. Meanwhile, the figures show the number of motor injury claims settled increased by 10% between January and June 2024 compared to the second half of 2023, but remained 20% lower than the 2015-2019 pre-Covid average. For motor injury claims that settled for less than €100,000 in H1 2024, the average compensation cost was down 23% compared to 2020, while the average total cost decreased by 13%. When including all injury claims however, the average total cost is effectively unchanged at €38,553, highlighting the contribution of large injury claims towards total claims costs. In H1 2024, three quarters (75%) of all claims were settled under the Personal Injury Guidelines - this includes 46% of litigated claims. Separately, the NCID shows the total cost of employers' liability and public liability claims fell by 10% to €144 million between the first half of 2024 and the preceding six months (H2 2023). The number of injury claims over the period (which accounted for the vast majority of all public liability claims) remained effectively unchanged at €2,100. In H1 2024, 42% of all employers and public liability injury claims were settled under the Personal Injuries Guidelines (22% of litigated claims). The figures also show that despite a fall in the number of injury claims, legal costs remain elevated. For claims under €100,000, legal fees rose to €7,128 during the first half of 2024, up from €5,512 (2015–2019 pre-Covid average). With regard to litigated claims, legal costs accounted for over 40% of the total claim cost in H1 2024. The rise in the cost of motor insurance claims comes as the Judicial Council's proposed 16.7% increase in the Personal Injuries Guidelines is due to be approved by the Government. Commenting on the NCID figures, the Alliance for Insurance Reform said they "make clear the Government's looming increase in personal injury awards couldn't come at a worse time for policyholders". Tracy Sheridan, owner of Kidspace play centres in Rathfarnham and Rathcoole and an Alliance board member said: "The only bright spot had been the reduction in the cost of injury awards and now the Government is set to increase these by (almost) 17%. "If this happens there will be no check on costs. We are already seeing month-on-month premium increases as the cost of living continues to spiral out of control. The Government needs to stand up for policyholders, not make things more difficult for them," she added. Regarding the fall in the cost of liability claims, Ms Sheridan said "there really is no excuse for liability premiums not to come down for business, sport, community and voluntary organisations as the cost of claims continues to reduce". Meanwhile, Insurance Ireland - the group representing insurers - said it notes "with growing concern" the "sharp rise in claims costs and the escalating burden of legal expenses". It said "these trends, if left unaddressed, pose a serious risk to the progress made by the Government's action plan for insurance reform for motor insurance for Irish consumers". Insurance Ireland also said "now is not the time to introduce an increase to the Personal Injuries Guidelines". Brokers Ireland also points to what it says are "inflated legal costs". Hazel Rock, Head of Insurance Services at Brokers Ireland, said the guidelines are having a clear cost-reducing effect on employer and public liability claims settled either directly or via the Injuries Resolution Board but that "there is still some way to go before we see the full impact of the measures taken by the Government to date. "While industry reports would suggest more competition is entering the market in areas where it has been limited to date, nonetheless insurance brokers still face the consequences of limited insurer appetite in high risk and niche sectors," she said. "The Injuries Resolution Board is underutilised, with a majority of claims still going to litigation, contributing to inflated legal costs. "Granting greater authority to the IRB and making awards binding in most cases, would help greatly, but concerns remain about the impact on premiums of the proposed 16.7% increase in injury awards," Ms Rock added.
RTÉ News
03-07-2025
- Automotive
- RTÉ News
Cost of settling motor insurance claims increased 23% in the first half of last year
There was a 23% increase in the cost of settling motor insurance claims during the first half of last year compared to the second half of 2023, according to latest figures from the Central Bank's National Claims Information Database (NCID). It shows the cost of motor claims settled between January and June 2024 was €414 million, with the Central Bank attributing the higher cost to an increase in damage claims. Meanwhile, the figures show the number of motor injury claims settled increased by 10% between January and June 2024 compared to the second half of 2023, but remained 20% lower than the 2015-2019 pre-Covid average. For motor injury claims that settled for less than €100,000 in H1 2024, the average compensation cost was down 23% compared to 2020, while the average total cost decreased by 13%. When including all injury claims however, the average total cost is effectively unchanged at €38,553, highlighting the contribution of large injury claims towards total claims costs. In H1 2024, three quarters (75%) of all claims were settled under the Personal Injury Guidelines - this includes 46% of litigated claims. Separately, the NCID shows the total cost of employers' liability and public liability claims fell by 10% to €144 million between the first half of 2024 and the preceding six months (H2 2023). The number of injury claims over the period (which accounted for the vast majority of all public liability claims) remained effectively unchanged at €2,100. In H1 2024, 42% of all employers and public liability injury claims were settled under the Personal Injuries Guidelines (22% of litigated claims). The figures also show that despite a fall in the number of injury claims, legal costs remain elevated. For claims under €100,000, legal fees rose to €7,128 during the first half of 2024, up from €5,512 (2015–2019 pre-Covid average). With regard to litigated claims, legal costs accounted for over 40% of the total claim cost in H1 2024. The rise in the cost of motor insurance claims comes as the Judicial Council's proposed 16.7% increase in the Personal Injuries Guidelines is due to be approved by the Government. Commenting on the NCID figures, the Alliance for Insurance Reform said they "make clear the Government's looming increase in personal injury awards couldn't come at a worse time for policyholders". Tracy Sheridan, owner of Kidspace play centres in Rathfarnham and Rathcoole and an Alliance board member said: "The only bright spot had been the reduction in the cost of injury awards and now the Government is set to increase these by (almost) 17%. "If this happens there will be no check on costs. We are already seeing month-on-month premium increases as the cost of living continues to spiral out of control. The Government needs to stand up for policyholders, not make things more difficult for them," she added. Regarding the fall in the cost of liability claims, Ms Sheridan said "there really is no excuse for liability premiums not to come down for business, sport, community and voluntary organisations as the cost of claims continues to reduce". Meanwhile, Insurance Ireland - the group representing insurers - said it notes "with growing concern" the "sharp rise in claims costs and the escalating burden of legal expenses". It said "these trends, if left unaddressed, pose a serious risk to the progress made by the Government's action plan for insurance reform for motor insurance for Irish consumers". Insurance Ireland also said "now is not the time to introduce an increase to the Personal Injuries Guidelines". Brokers Ireland also points to what it says are "inflated legal costs". Hazel Rock, Head of Insurance Services at Brokers Ireland, said the guidelines are having a clear cost-reducing effect on employer and public liability claims settled either directly or via the Injuries Resolution Board but that "there is still some way to go before we see the full impact of the measures taken by the Government to date. "While industry reports would suggest more competition is entering the market in areas where it has been limited to date, nonetheless insurance brokers still face the consequences of limited insurer appetite in high risk and niche sectors," she said. "The Injuries Resolution Board is underutilised, with a majority of claims still going to litigation, contributing to inflated legal costs. "Granting greater authority to the IRB and making awards binding in most cases, would help greatly, but concerns remain about the impact on premiums of the proposed 16.7% increase in injury awards," Ms Rock added.
