Minister: We are going to tackle the compo culture Industry: It’ll take years for the reforms to kick in
Carroll MacNeill insists a legislative overhaul will make ice-rinks and bouncy castles easier to insure
THE minister in charge of insurance has vowed that Government reforms will bring an end to ‘compo culture’ – but businesses reckon it will take years to see the effects.
Junior finance minister and Fine Gael TD Jennifer Carroll MacNeill has said key insurance reforms brought in under the Government’s Action Plan for Insurance Reform are ‘largely complete’.
Ms Carroll MacNeill said that bouncy castles, ice-rinks and horse-riding centres will be easier to insure as the reforms mean higher risk activities that were once insurance no-go areas have been ‘resolved’.
She told the Irish Daily Mail: ‘The pinch points that we had, childcare, bouncy castles, those... all but two have been resolved.
‘There was equestrian, there were bouncy castles, there were playcentres, a whole range of different ones.’
The junior minister noted that one consequence of the implementation of the ‘Occupiers Liability Act’ is that places where insurance could not be secured are being eliminated.
She added: ‘This is only happening because of the government reforms: because there is a more predictable stable market.’
This legislative change reduces the burden on occupiers around the duty of care they owe to those on their premises and raises the threshold for a finding of liability against the occupier.
But cases already filed will be tried under the old rules, meaning that it will take time before the new legislation is tested in court.
‘The next base where we can get important valuable reductions is on insurance for businesses, for cafes, hotels,’ Ms Carroll MacNeill said.
‘We have changed the rules on public liability very considerably where all the responsibility fell to the coffee shop or to the hotel. Now there’s a much bigger voluntary assumption of risk if you go in and you use their facilities.
‘That is going to make a big cultural difference, this excessive slips, trips and falls, that sort of claim, it’s going after that.
‘Already we are seeing insurers begin to respond by increasing their risk appetite, so for sports clubs for example or I see places like ice-rinks get more than one quote where last year they only got one.’
However, businesses in the industry remain unconvinced. Tommy Gill, chief executive of Play Activity & Leisure Ireland, which represents soft play centres for children, said that he is still getting a handful of calls weekly from small businesses who cannot get insurance.
Mr Gill who also owns Wild West play centre in Westport, Co Mayo, said they are not seeing the ‘pull through’ with the reduction in claims and awards leading to a reduction in premiums.
He said that Irish businesses have access to the ‘world of underwriters’ but for certain sectors ‘they just won’t quote’.
Gerry Frawley of the Irish Inflatable Hirers Federation said that bouncy castle owners in his group have been able to get an insurance quote – but only though the work of the federation. ‘It’s not because of government reform,’ he added.
‘The government reforms have not trickled down yet, we’re hopeful but we’re not jumping for joy yet.’
Junior Enterprise Minister Dara Calleary told the Irish Daily Mail that the Government has ‘completely changed’ the ‘risk profile’ of insurance in Ireland.
He said there has ‘definitely’ been a reduction in car insurance but admits that employers’ liability insurance is still high, and he wants to see this reduced in 2024.
But Peter Boland from the Alliance for Insurance Reform said that the new act needs to be challenged and upheld by a judge before it will have any impact on premiums.
He told the Mail: ‘We wouldn’t expect that to happen for another two to three years at the earliest.
There’s no evidence to suggest that pinch points, as the minister calls them, are seeing any reductions in premiums.
‘There might be an improvement in availability, but it’s availability at an extremely high cost.
‘Ireland is still paying – not just those pinch points, but right across the board – many multiples of what other countries are paying on premiums, including Northern Ireland, for example.’
He is calling on the Government to place ‘relentless pressure’ on the insurance companies to reduce their premiums in turn.
He said that since 2019, the number of claims has dropped by 40% due to the Government’s reforms around judicial guidelines for awards on personal injury cases. However, he said this large drop in claims should have led to a significant decrease in premium costs but that has not materalised.
Ireland’s largest operator of ice rinks, Bill Cremin, owner of Cool Running Events, said that while he ‘admires the spirit’ of the legislative change and welcomes the efforts from Minister Carroll MacNeill ‘we’ve seen no evidence of its impact on premiums at this stage’.
He went on: ‘My issue is that the cost of processing individual claims is just absolutely extortionate.’
He said that in one recent case, his company settled out of court for a ‘slip and trip’ claim that cost €391,000.
‘That’s the payouts for claims and if that makes your eyes water, then our premium would make you actually beg for mercy.’
Ms Carroll MacNeil warned that legal fees and the reluctance of solicitors to use the Injuries Resolution Board, formerly the PIAB, continue to be a challenge.
She pledged: ‘I think we can get more from the reforms we have implemented.
‘This space remains to be tightened very considerably.’
Ms MacNeill said that the arrival of a new company OUTsurance was a ‘vote of confidence in the pace and scale of recent Government changes’.
‘It would make you beg for mercy’