Business have called for urgent action to reform the State’s compensation-paying mechanism for accident victims.
The Alliance for Insurance Reform said a failure to strengthen the Personal Injuries Assessment Board (PIAB) will mean lawyers will end up managing and controlling the system for paying compensation to people who are injured.
The comments follow a meeting the alliance had with junior minister with responsibility for PIAB Robert Troy, with representatives from the SME and the retail sectors also involved.
The minister was told the alliance was alarmed at statistics produced by the Central Bank on motor insurance which show a decline in the number of claims being settled by PIAB out of the total settled each year.
Last year 14pc of injury claims were settled by the State body. A third were settled through litigation, with 52pc settled directly by insurers.
The percentage settled through PIAB was 18pc in 2016, according to this month’s Private Motor Insurance Report extracted from the Central Bank’s National Claims Information Database.
PIAB was put in place to settle claims without the need to incur legal costs.
It said recently the Central Bank had shown that the legal costs involved in litigated claims are more than 15 times greater than those settled through it.
The Alliance for Insurance Reform said PIAB had a profound impact on insurance costs when it was launched in 2004.
Alliance chairman Eoin McCambridge said: “But it has been undermined since then to the extent that far more cases now go to litigation, with no benefit for plaintiffs, but enormous fees for solicitors and barristers.”
Director of the Alliance Peter Boland said that if urgent and radical reform of PIAB is not carried out, it will be irrelevant within a decade.
“We will be back to a situation where the compensation of people injured due to the negligence of others will be a process managed and controlled by the legal profession, for the benefit of the legal profession, with dire consequences for the cost and availability of insurance cover in Ireland.”
He said it was up to the minister to address this issue now.
Among those at the meeting were Vincent Jennings of the Convenience Stores and Newsagents’ Association; Duncan Graham, Retail Excellence; Brendan Kenny of Ireland’s Association for Adventure Tourism; Neil McDonnell of Isme; and Adrian Cummins of the Restaurants’ Association.