Mary Harney (Dublin Mid West, Progressive Democrats)

The establishment of the Personal Injuries Assessment Board is a significant milestone in the Government's insurance reform programme, which I am confident will lead to reduced insurance premia to the benefit of both consumers and business alike. By eliminating the need for litigation costs where legal issues are not in dispute, the PIAB will significantly reduce the cost of delivering compensation. The PIAB will also offer speedier assessments to the benefit of claimants.

It is generally recognised that litigation costs add between 40% and 50% to the cost of a personal injury claim. It is intended that the PIAB will make significant inroads into this figure. The PIAB will, however, carry out a cost benefit analysis of the new system as against the system prior to the introduction of the board and this will indicate the reduction in the level of litigation.

The pricing and underwriting of insurance is a matter for individual insurance companies and EU law prevents governments from intervening directly in regard to premia levels. However, it is expected that reductions in litigation costs will lead to corresponding reductions in premium levels.

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