Body calls for reforms to address ‘unsustainable insurance costs’

THE Alliance for Insurance Reform has said the results of the PPN survey and a recent survey of its own members clearly indicate the grip that the insurance crisis has taken on Irish society.

A representative body, it was formed with the sole objective of reducing spiralling insurance costs in Ireland to what it describes as “sustainable” levels.

The group consists of a wide range of civic, sporting and small business bodies as well as individual businesses, all of whom are affected by what the Alliance believes is the “unsustainable costs of insurance in Ireland”.

It is calling for a number of reforms to be taken to prevent “exaggerated and misleading claims being pursued and settled”.

These included the establishment of a Garda insurance fraud unit, the linking of sections of the Civil Liability Act (2004) so that exaggerated and misleading claims are automatically forwarded to Gardaí for potential prosecution, the publication of an up to date ‘ Key Information Report’ on employer and public liability insurance claims, and publication of a ‘claimbyregister’.

It believes these and other measures would result in greater transparency on how premiums are calculated and claims settled, and consistency in the calculation of awards at realistic and affordable levels.

During the summer the Alliance also conducted a survey, primarily in the context of primarily Public and Employer Liability insurance, among members from charities, voluntary groups, sporting organisations and SMEs.

Its findings found that respondents’ insurance costs have risen by an average of 204%, 63% had been hit with increased excesses or new exclusions to their policies and that insurance now accounts for 10% of expenditure incurred by charities.

A quarter of respondents said that insurance costs were threatening the security of jobs, one-third said it was preventing them from providing new services, 46% said it was restraining their ability to grow, and just under half said it was threatening the very future of their organisation.

As with the PPN survey, the vast majority of respondents, in this case 95%, said the Government was not doing enough to address the issue of rising insurance costs.

The Alliance said the reforms it has suggested would quickly reduce liability and motor insurance premiums to affordable levels and keep them that way.

The director of the Alliance, Peter Boland, said the Government has yet to deliver its much-heralded Judicial Council, intended to address sky-high damages for minor injuries among other things.

“If the Government is serious about protecting voluntary and community groups they must accelerate the process of establishing the Judicial Council and do everything in their control to facilitate the Judiciary in addressing this crucial issue,” said Mr Boland.

He said the Alliance would also urge the Judiciary to proceed with the general damages review process “as a matter of urgency” and reflect the common good in using the guiding principles of recent court decisions to set damages for minor injuries at “moderate, proportionate and common-sense levels”.

“Finally, after nearly three years of deliberation, there is no sign of any enhanced operational response by An Garda Síochána to insurance fraud. We would urge the Ministers for Finance and Justice to fund this essential action using the reserves currently being taken from the Personal Injuries Assessment Board and rolled into Exchequer funds,” said Mr Boland.