Court ruling means it’s time for insurers to deliver cuts

Insurance companies have run out of excuses and must sharply reduce premiums for consumers, businesses and voluntary groups. The Supreme Court’s decision that the personal injury award guidelines voted in by judges three years ago are legally binding means the spoofing of the industry has to stop and the time to deliver proper reductions in premiums has arrived.

The insurers had promised cuts in the cost of cover if they got these reforms.

They now have that, so it is time for the insurance industry to deliver.

The Supreme Court judgment means the easy money being made by some lawyers on personal injuries claims should end.

There are indications that some judges are throwing out some of the more outlandish and dodgy claims that come before them.

But there is still a huge tendency by some in the legal profession – hooked on the nice little earner that is personal injuries litigation – to steer their clients into taking cases to court instead of settling when an award is offered by the Personal Injuries Board.

The Supreme Court ruling removes one of the last excuses being trotted out by an industry that seems adept at giving us reasons for not reducing premiums.

The insurance industry has now been given everything it had asked for from the Government in terms of insurance reform. Here are the highlights:

⬤ The Personal Injuries Guidelines have cut award levels by up to 40pc.

⬤ Duty-of-care legislation had been updated to the benefit of insurers.

⬤ A dedicated garda fraud office has been set up.

⬤ What we used to call the Personal Injuries Assessment Board (now the Injuries Resolution Board) has been reformed.

The industry had told numerous Oireachtas Committee hearings that it would reduce premiums if these reforms were delivered.

However, the challenge to the personal injuries guidelines that had been put in place by the judiciary has been held up by the insurance industry as a reason to hold back on cutting premiums.

Now that excuse is gone too with the Supreme Court ruling.

The Alliance for Insurance Reform and the Convenience Stores and Newsagents Association were both quick out of the blocks to demand lower consumer and business cover.

The lobby group for the industry, Insurance Ireland, welcomed the judgment and said it may encourage new insurance entrants to the market.

However, there was no commitment to reduce premiums. No doubt it will argue that as an industry body it is precluded from price-signalling.

The industry has been back making healthy profits. Google “insurance industry + profits + Ireland” and you get a raft of hits for insurers showing they are making decent profits. But the game is up now. What the Consumers’ Association of Ireland has claimed is price gouging has to stop. It is time the policyholders of Ireland had a break from highcost insurance.