Insurance Ireland Statement on the Central Bank of Ireland’s NCID Employers’ and Public Liability Mid-Year Data Release for H1 2022

 

Insurance Ireland today commented on the publication of the Central Bank of Ireland’s (CBI) first NCID mid-year data release on liability insurance settled claim trends up 30th June 2022.

  • 22% of liability claims settled in H1 2022 settled under Personal Injury Guidelines. Guidelines.
  • Litigation is the largest claim settlement channel accounting for 71% of injury claims and 89% of settled injury cost.
  • Findings show that insurers are applying the Personal Injury Guidelines to the majority of claims now settling under the Direct and PIAB channels. Only 3% of litigated claims settled under the Guidelines.
  • CBI note data for 2020, 2021 and 2022 is influenced by the impact of COVID-19 and subsequent government restrictions

13th July 2023: Moyagh Murdock, CEO of Insurance Ireland said: “We welcome this interim report, which provides informative insights into settled claims in the Employers’ and Public Liability insurance market. The report found that while the Personal Injury Guidelines are now being applied in the majority of claims settled under the Direct and PIAB settlement channels, only 3% of litigated claims have been settled under the Guidelines due to the more protracted length of time a claim taken to settle going through this channel, while 89% of injury claim costs in H1 2022 were settled through the litigation channel.  The NCID report notes that the overall impact of the Personal Injury Guidelines on average claim costs is limited as claims settled via litigation represent the largest proportion of the total claims cost, and to date they have not yet been materially impacted by the Guidelines.

Moyagh Murdock said “Successive NCID reports have consistently shown that the litigated channels still accounts for the majority of claims costs.  This further highlights that the strengthened role of PIAB to increase settlements though mediation and without unnecessary litigation is critically important. We have recently seen from the publication of a recent European Commission report that the high level of litigation costs in Ireland continues to be a cause of concern[1].

The NCID mid-year report shows that:

  • The majority (78%)of claims for H1 2022 in the data report were settled under the Book of Quantum, and not under the Personal Injury guidelines.
  • The average claim cost for injury claims settling through litigation were 3% higher in H1 2022 compared to the 2015 to 2019 average.

It will likely take some time for the Personal Injuries Guidelines to take effect in the litigated settlement channel due to the protracted length of time from claims first being reported and settled (5.2 years on average for claims settled in H1 2022). There has been a reduction in the number of claims settled in the Direct and PIAB channels which resulted in a 12% reduction in the overall cost of settled injury claims in H1 2022 compared to the 2015 to 2019 pre-Covid average. The litigation channel, which accounts for the majority of claims (71%) and claim costs (89%) in H1 2022 has seen a small increase in the number and average cost of claims compared to the 2015 to 2019 pre-Covid average. 

Moyagh Murdock said “The signing into law of the changes to the Occupiers’ Liability Act on the duty of care in Ireland is an important step, marking the completion of the Government’s very welcome insurance reform agenda. Insurance Ireland has continually stated that a rebalancing of the standard is crucial to ensure sustainable cover is available to small and medium enterprises and consumers into the future. We have called for these measures for many years, which should make the Irish insurance mark: et more reasonable, practical and proportionate for claimants, businesses, sporting clubs and community groups alike.

Up until the recent enactment of the Courts and Civil Law (Miscellaneous Provisions) Act 2023, under the previous law, there has been an imbalanced and unfair onus on businesses and owners when it comes to commonplace injuries like slips, trips and falls. The recent changes to duty of care laws introduce a more common sense approach with personal responsibility becoming a factor on the part of customers and members of the public. Our hope is that this final piece of the reform jigsaw will lead to real change in the EL/PL markets, making them more viable for insurers to come back to this sector of the market and compete. This will be key to attracting new players into the market. That is why we strongly support the Government’s work in this space. This in our view will deliver better value for businesses and consumers in the long run.”

Ends//

 

[1] https://commission.europa.eu/publications/2023-rule-law-report-communication-and-country-chapters_en

 

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