Tuesday, 2 November 2021
Ceisteanna Eile - Other Questions
Personal Injuries Assessment Board
7. To ask the Minister for Enterprise, Trade and Employment his assessment of the latest Personal Injuries Assessment Board on personal injury awards; and if he will make a statement on the matter. [52657/21]
Can the Tánaiste give me his assessment of the latest personal injuries awards of the Personal Injuries Assessment Board, PIAB? When can we see that having an impact on the cost of insurance for individuals, businesses and sporting organisations?
I thank the Deputy for his question. Insurance reform is a priority for the Government and for me, as Tánaiste. Premiums have been too high for too long and I know some businesses and volunteer groups continue to struggle to find insurance at any price. The Personal Injury Guidelines were commenced on 24 April 2021. This met the programme for Government commitment to recognise the work of the Judicial Council in providing guidance on personal injury claims.
The report published by the PIAB on 15 October 2021 provides an insight into the impact of the guidelines on average award levels, as assessed by the board. The report is also based on a much larger sample than our previous figures. It shows that the average general damages awarded under the guidelines is €11,808, a 46% decrease on 2020. The average total award under the guidelines is €14,223, a 40% decrease on 2020. Some 71% of awards are now €15,000 or less, compared to 30% of awards in 2020.
These figures are welcome and show that the Personal Injuries Guidelines brought into effect by the Government are having an impact. I expect this dramatic drop in award levels to be reflected in reduced premiums and the Government will continue to work and to press the insurance sector to make sure this is the case.
The Personal Injury Guidelines are just one measure brought forward under the Government's action plan for insurance reform. Further actions due this year include reform of the law on occupier's liability, enhancement of the role of PIAB, and the strengthening of competition law in Ireland more generally.
Implementation of these legislative reforms alongside other actions set out in the action plan should bring about meaningful reform of the insurance market and create the conditions for the provision of affordable insurance for consumers, community and voluntary groups, and business.
I thank the Tánaiste for his reply. We all welcome the fall in the level of awards made. When are we going to see this reflected in the price of insurance? When does the Tánaiste expect this to happen? Has he had any engagement with insurance companies on this? According to the Alliance for Insurance Reform, public liability insurance premiums continue to rise the despite a significant fall in the size of injury awards. It states that motor insurance premiums are coming down but that is not the case with public liability insurance. This is having a significant impact on businesses and the sporting organisations. The experience of SMEs, voluntary and community groups, sport and cultural organisations and charities is that renewals are actually increasing right now. The alliance states that the insurance companies cannot have their cake and eat it. It has identified the cost of claims as the key driver of insurance costs and this has been addressed by the Government and the Judiciary. As an elected representative, I am asking the Tánaiste to ensure that the drop in the level of awards is reflected in the cost of insurance to both the general public, businesses and sporting organisations.
I thank the Deputy. It is clear that a fall in the awards that are given to people who have been injured should result in a fall in insurance premiums but it is not the case that a 40% or 50% fall in awards through the PIAB will not result in a 40% or 50% fall in premiums. That is because many or, indeed, most cases do not go through the PIAB. Many are settled before that and that is why insurance companies need to change their settlement strategy. A small proportion, of course, end up in court. Many factors go into the cost of insurance claims and general damages is one part of that.
Central Statistics Office, CSO, data indicate a fall in motor insurance costs. The research from the Alliance for Insurance Reform does not show a decrease yet for public liability. Chambers Ireland would give us some sense that there has been a bit of a fall but we are going to have to watch this over the next couple of months. There is an engagement directly with the industry where the Minister of State, Deputy Fleming, meets individually with the CEOs of all of the major companies and is doing a second round of these meetings at the moment to impress upon them our expectation that there should be a euro-for-euro passing on of these reductions in terms of lower premiums.
Neil McDonnell, the chief executive of ISME, said he would like to see the Government implement the provision of the Civil Liability and Courts Act 2004 providing for the creation of a register of the parties taking personal injury actions, in order to identify potential abuses of the system by persons who make multiple claims. That would be a welcome development in helping to expose anybody who is making fraudulent claims.
The Tánaiste stated that some sectors are finding it very hard to get insurance. Does the Government have any plans to ensure that insurance companies are obliged to give a quote for companies in certain sectors, especially those providing recreational activity and sports services, including water parks, hunting and point-to-point racing? There is an issue arising now whereby no insurance company is giving quotes for those companies and it is a huge problem for the recreational activity and sports sector. Has the Government any plans to address that part of competition law to ensure organisations at least have the ability to get a quote in respect of the activities they provide?
At the most recent Cabinet committee meeting on insurance, we did an assessment of sectors where it is not possible to get insurance. That involved speaking to insurance companies and brokers. There is a small number of sectors where it is not possible to get insurance at the moment. We are following up on that and trying to understand it better to see what we can do to help the situation. I understand it would be possible legally to require insurers to give a quote, but that might not be the solution because the quote given could be cost-prohibitive. That would not provide the solution we need. One thing that can work is an engagement between the industry affected and the insurers. We nearly got into a situation a year or two ago where there was no one willing to quote for childcare providers. The sector got together and, by making some changes, it was possible to get an insurer to cover them. That might be what is required in some of the high-risk sectors to which the Deputy referred. Changes they make can make a difference and make them more insurable.