Dáil Éireann Debate, Wednesday - 24 March 2021
479. Deputy Martin Browne asked the Minister for Finance his views on the amounts in personal injuries insurance guidelines as set by the Judicial Council; and his views on whether the level of payment for damages is a contributor to the excessive costs of insurance premiums. [15177/21]
View answer484. Deputy Michael McNamara asked the Minister for Finance if he will intervene as a matter of urgency regarding the increasing insurance costs on small businesses and reduce damages for minor injuries by 80% given that the Law Reform Commission has made it clear that direct intervention by the legislature to cap damages will be entirely constitutional subject to certain safeguards; and if he will make a statement on the matter. [15193/21]
View answerI propose to take Questions Nos. 479 and 484 together.
In relation to the questions raised by the Deputies regarding the cost of insurance and the Personal Injuries Guidelines, I would first note that addressing the cost of insurance is a key aim of the Government’s Action Plan for Insurance Reform. In this regard, I welcome the recent publication of the Personal Injuries Guidelines by the Judicial Council, which represents an important action of the Action Plan.
The Guidelines significantly reduce award levels for many categories of common injuries, particularly those of soft tissue. Of note is that a number of common injuries will now move to the jurisdiction of the District rather than the Circuit Court, thus reducing associated legal fees. The Guidelines also provide guidance in relation to injuries previously not included in the Book of Quantum and will be used by both the Personal Injuries Assessment Board (PIAB) and the judiciary. Therefore, in addition to the lower awards and legal fees, the Guidelines should help to bring more certainty to claimants and insurers, and as such reinforce the benefits of using PIAB to settle claims. This in turn should further reduce the costs of claims, particularly legal fees. Amendments will be advanced through the Family Leave Bill 2021 to allow implementation of these Guidelines as soon as possible. I believe it needs to be recognised that the Guidelines were carefully considered by the judiciary. As such we will need a period of reflection to assess their implementation, and they should be given some time to be applied in practice. I would further note that although the Law Reform Commission’s report on “Capping Damages in Personal Injuries Actions” provided a potential legislative model to cap award levels, it also concluded that it would be entirely appropriate, and desirable, that the new Guidelines be given some time to be applied in practice.
In terms of the benefits accruing from reduced award levels, the insurance industry has previously committed to reduce premiums in line with lower award levels, so as such, my expectation is that insurers will commence reflecting these savings to consumers, businesses and other groups. In this regard, the Minister of State, Deputy Fleming, is meeting the CEOs of the main firms in the coming weeks to hear how they will respond to these recent developments. In addition, I would hope that the improved insurance operating environment may help to attract new entrants into the Irish market, thereby increasing competition.
Finally, it is important to note that publication of the Personal Injuries Guidelines represents just one of the 66 actions in the Action Plan on Insurance Reform. Other actions aimed at reducing the cost of insurance include proposals to increase competition, address dual pricing, and reform PIAB. I believe that the new Personal Injuries Guidelines, in conjunction with these and other aspects of the Government’s insurance reform agenda, should go some way to improving both the cost and availability of insurance for businesses, consumers, and other groups in Ireland.
