Thursday, 28 November 2019
Department of Finance
82. To ask the Minister for Finance the role his Department has in the proposed new limits to insurance pay out claims and revisions to the book of quantum from early 2020; and if he will make a statement on the matter. [49620/19]
At the outset, it is important to note that as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation and my Department has no role in the area of award levels or changes to the Book of Quantum.
The Cost of Insurance Working Group which was established by my predecessor as Minister for Finance, and which is currently chaired by Minister of State Michael D’Arcy TD has always recognised that the single most essential challenge, which must be addressed if we are to overcome the current insurance cost and availability problems, is to bring the levels of personal injury damages awarded in this country more in line with those awarded in other jurisdictions. A key recommendation arising from the CIWG’s reports was the establishment of the Personal Injuries Commission (PIC) and the publication of its two reports. The PIC conducted a benchmarking of award levels exercise between Ireland and other jurisdictions for the first time and this has been very helpful in identifying the scale of the problem that is faced. This research showed that award levels for soft tissue injuries in Ireland are 4.4 times higher than in England and Wales. The PIC recommended that a Judicial Council be established and that it should compile guidelines for appropriate general damages for various types of personal injury. In carrying out this exercise, the PIC believes that the Judiciary will take account of the jurisprudence of the Court of Appeal, the results of its benchmarking exercise, etc.
The relevant legislation to establish the Judicial Council was a matter for the Minister for Justice and Equality, and as the Deputy will be aware, the Government with the support of all parties in the Oireachtas prioritised the passing of the Judicial Council Act 2019. This Act provides for the establishment of a Personal Injuries Guidelines Committee upon the formal establishment of the Judicial Council. This Committee is tasked with introducing new guidelines to replace the Book of Quantum. It is important to note that the Government cannot interfere in their deliberations.
A key step to moving this matter forward is for the Chief Justice to make the necessary appointments to the Personal Injuries Guidelines Committee. I therefore welcome the recent announcement by Chief Justice Clarke that he has designated the seven judges that will sit on the Committee. I understand that the designate committee will commence its activities on an informal basis shortly. This is an important development as it demonstrates that the Judiciary are giving this matter the priority I believe it deserves. While I appreciate that the development of a new set of personal injury award guidelines is the prerogative of the Judiciary, I believe that much work has already been done, in particular the PIC benchmarking exercise, which should assist the Judiciary in completing this work as soon as possible. The Government is willing to provide the Judiciary with any background assistance, such as input from the Cost of Insurance Working Group, should they think that necessary. In that context, I am happy for my Department to play its role. I also understand that PIAB has written to the Judiciary to offer its expertise and assistance for the purpose of this recalibration exercise.
I might also add that in addition to the work of the Personal Injuries Guidelines Committee, the Law Reform Commission (LRC) is carrying out a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries. This is another important recommendation of the CIWG, which I believe should not be overlooked. I believe that if there was a significant move in this area, it could also have an impact on insurance pricing and could also help attract new entrants into the insurance market.
Finally, as I have stated before, I believe that if the issue of the level of awards in this country is addressed, that the problems facing particular businesses and community groups as a result of particular insurers either withdrawing from the market or increasing the price of insurance should recede.