Dáil Éireann Debate, Wednesday - 21 April 2021
499. Deputy Marian Harkin asked the Minister for Finance if he will review the whole area of insurance reform and consider capping general damages for minor injuries by an average of 80% compared to the previous book of quantum guidelines (details supplied); and if he will make a statement on the matter. [19225/21]
View answerThe Government has prioritised the reform of the insurance sector in order to improve the cost and availability of this key financial service, including for businesses. The Action Plan for Insurance Reform sets out 66 actions in this regard across several policy areas, including my Department, with 95% due for completion by end 2021. At a recent Government meeting, the Cabinet reflected upon the work of the Cabinet Sub-Group on Insurance Reform, which oversees the implementation of the Action Plan, and to note of the considerable progress made in the first three months of this year. Achievements include:
- The adoption of new Personal Injuries Guidelines by the Judicial Council.
- The creation of an Office to Promote Competition in the Insurance Market within the Department of Finance.
- The launch of a public consultation on proposals to reform the Personal Injuries Assessment Board.
The new Personal Injuries Guidelines significantly reduce award levels for many categories of common injury, particularly those of soft tissue, and provide further details on how these should be assessed. Also 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 the 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 judiciary. Therefore, in addition to the lower awards and legal fees, the new Guidelines should provide more certainty to claimants and insurers, and as such reinforce the benefits of using the PIAB for claims settlement. This in turn should further reduce the costs of claims, particularly legal fees. The new Guidelines will come into effect on 24 April, which is ahead of it's July 2021 schedule.
While the issue of capping award levels is a matter for the Minister for Justice, I would note that, under the Action Plan for Insurance Reform, the Department of Justice is to report on the implementation and early impact of the new Guidelines, and to examine a relevant policy response by the end of the year, taking account of the LRC’s conclusions. That said, I would also note that the Law Reform Commission’s (LRC) Report on Capping Damages in Personal Injuries Actions concluded that it would be entirely appropriate, and desirable, that the new Guidelines be given some time to be applied in practice. While I note that some may feel the reduced award levels do not go far enough, I believe that it needs to be recognised that this was carefully considered by the Judiciary. As such, a period of reflection to assess their implementation may be approapriate before considering any further measures.
In summary, the Personal Injuries Guidelines, in conjunction with other strands of the insurance reform agenda, should improve both the cost and availability of insurance for businesses, consumers, and other voluntary, sporting and community groups. The Deputy can be assured that the Government is committed to achieving a more sustainable and competitive insurance market, and is continuing to progress other aspects of the Action Plan for Insurance Reform .
