Lack of figures to back up motor insurance rises, says Injuries Board chief
Comments come as injury award guidelines updated for first time in 12 years
A revised Book of Quantum, which provides general guidelines for the amounts to be awarded in personal injury claims, has been published. This is the first time in 12 years that the guidelines have been updated.
The publication was commissioned by the Injuries Board and compiled by independent consultants Verisk Analytics. The guidelines are based on an analysis of compensation awards from court cases, insurance company settlements, State Claims Agency cases and data relating to awards by the Injuries Board.
The board said that, as there were more injury types in the new guidelines and the brackets had been expanded significantly to reflect prevailing awards, awards for some injury types had increased while others had contracted.
The book was revised to help to ensure that there is consistency between the personal injury awards made by the board and by the courts. The aim is to persuade more accident victims to accept their Injuries Board offer rather than going on to court in the hope of getting a higher pay-out.
The Minister for Jobs, Enterprise and Innovation, Mary Mitchell O'Connor, welcomed the publication, saying it should help reduce the cost of insurance by stabilising awards and bringing consistency and predictability to the cost of processing personal injury claims.
The chief executive of the Personal Injuries Assessment Board Conor O'Brien said the updated guidelines were being published against a backdrop of a lack of data identifying precise causes for increasing motor insurance premiums. "Data gaps across the market remain and we reiterate our call for greater data transparency across the insurance market so the factors impacting premiums can be understood,” he said.
But the Small Firms Association has criticised the new guidelines, describing them as a missed opportunity. SFA chairman AJ Noonan said the new book reflected the level of awards that had been made in recent years, rather than assessing what would be an appropriate and fair award for specific injuries.
“The figures in the new Book of Quantum confirm the steep rise in awards for a variety of insurance claims, which have contributed to the current insurance costs crisis for businesses and individuals. Rather than accepting these increases as the new normal, all parties must step up efforts to address the multiple failures of the Irish insurance landscape,” said Noonan.
The latest Central Statistics Office figures show that insurance costs rose 12.8 per cent in the year to August, with motor insurance costs jumping by 28 per cent.
Insurers say that more claims and an increase in the cost of settling claims are adding to price pressures in the insurance market. Insurance Ireland, the representative body for the Irish insurance sector, believes that the level of court awards made here is out of kilter with other markets. But others say that much of the price pressure can be attributed to insurers competing too aggressively a few years ago during an era of unsustainably low pricing.
The Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach is resuming its hearings on the cost of motor insurance tomorrow, when it will be addressed by Central Bank deputy governor Cyril Roux and the bank's director of consumer protection Bernard Sheridan. The Government has also set up a review of the industry.
The publication of the revised guidelines came a survey carried out by retail grocery group RGDATA found that its members are reporting what they describe as "an unprecedented level' of personal injury claims over the last 12 months with more than one-third having faced at least one new claim in the last year.
85 per cent of retailers said they had seen an increase in their insurance premiums over the last year, the an average increase of just over 30 per cent, but some reporting jumps of up to 150 per cent.