Irish Soft Tissue Compensation Awards Now 4.4 times the UK Level Highlighting Urgent Need for Reform
- 78% of Irish people would support proposals to reduce personal injury award levels according to Ipsos MRBI poll
- Personal Injuries Commission report shows the average Irish soft tissue compensation award is €17,338 compared to €3,984 in the UK
- Raw data provided on all motor claims paid for 2015, 2016 & 2017 by Insurance Ireland’s members was independently verified by KPMG
- “The Commission’s finding that Irish compensation awards are a ‘stark multiple’ of awards for the same injury in the UK raises societal questions about what is affordable and what is sustainable. Ultimately, only Government action can prevent these costs getting even higher.” – Kevin Thompson, CEO Insurance Ireland
Issued 18 September 2018. Insurance Ireland has said the Personal Injuries Commission’s finding that Irish personal injury compensation awards are a ‘stark multiple’ of awards in the UK shows that a policy response is urgently needed as inaction costs.
Insurance Ireland’s motor insurers provided raw data for 2015, 2016 and 2017 for all motor paid claims across all settlement channels including those settled directly by insurers, through the Personal Injuries Assessment Board and through the courts.
This data allowed the Personal Injuries Commission, chaired by the former President of the High Court, Justice Nicholas Kearns, to conduct a landmark comparison of Irish personal injury award levels with other countries. The results, which were independently verified by KPMG, shows that the average soft tissue award in Ireland is now €17,338, compared to €3,984 in the UK. In addition, the cost of the average compensation award for all personal injury awards up to €100,000 is increasing at over €900 per year.
Commenting on the findings, Kevin Thompson, CEO of Insurance Ireland said, “The evidence is clear, our personal injury compensation awards are dramatically out of kilter internationally and they are getting more expensive. Eight out of 10 motor injury claims in Ireland are for soft tissue and our compensation awards continue to spiral whereas legislation is being brought in to cap them in the UK. It is also clear that the Irish public supports reform as according to a nationally representative poll conducted by Ipsos MRBI in January, 78% of Irish people would support proposals to reduce personal injury award levels.”
“The Commission’s finding that Irish compensation awards are a ‘stark multiple’ of awards for the same injury in the UK raises societal questions about what is affordable and what is sustainable. Ultimately, only Government action can prevent these costs getting even higher. We fully agree with Justice Kearns that ‘Irish society is presented now with an important opportunity to consider an appropriate rebalancing and recalibration of Irish awards, both in the context of their relative values to each other and comparatively to other jurisdictions’.”
Kevin concluded, “Justice Nicholas Kearns is to be commended for his leadership in chairing the Personal Injuries Commission in a fair minded and committed way. He ensured it was an exacting process that was built on verifiable data. This landmark report shows customers the key costs in the market and it shows policymakers the need for urgent reform.”
The Personal Injuries Commission report was based on data provided by Insurance Ireland’s members and was independently validated by KPMG. This is one of five data submissions made by Insurance Ireland over the past 24 months to help inform public policy. This is the second report of the Personal Injuries Commission with the first, in November 2017, having recommended new means to link diagnosis and treatment of soft tissue injuries with the appropriate award level. The Commission’s report was overseen by all its members, which included representatives from the Department of Business, Enterprise & Innovation, the Department of Justice & Equality, the Law Society, the Bar of Ireland, the Irish Hospital Consultants Association, Insurance Ireland, the Competition and Consumer Protection Commission, the State Claims Agency, and the Personal Injuries Assessment Board.
Notes for Editors:
Key statistics on the claims environment:
- From 2012-2015 there was a 44% increase in the gross cost of motor claims incurred (Central Bank of Ireland Insurance Statistics Reports)
- Third party injury costs per claim are £11,000- £13,000 in the UK compared to €40,000-€60,000 in Ireland. (Second Motor Insurance Key Information Document. Dept. of Finance, pg. 21)
- €42,400 in legal & other costs are paid on an award of €100,000. (First Motor Insurance Key Information Document, Dept. of Finance, page 4)
The five data submissions made by Insurance Ireland to inform policy were:
- The data supplied to the then Minister of State Eoghan Murphy in November 2016 to inform the first Cost of Insurance Working Group Report (published January 2017)
- The data submission for the Department of Finance’s first Motor Insurance Key Information Document (published in July 2017)
- The submission of data for the second Cost of Insurance Working Group Report on Employers’ Liability and Public Liability (published in January 2018)
- The submission of data for the Motor Data Project published as the Department of Finance’s Second Motor Insurance Key Information Document (published May 2018)
- The submission of data for the Personal Injuries Commission in November 2017.
The polling cited was conducted by IPSOS MRBI in January 2018 and the question asked was ‘Would you support or would you not support proposals to reduce personal injury award levels in Ireland by benchmarking them against levels in other comparable countries?’ (all adults aged 17+; sample of 977). 78% would support; 13% would not support; 9% do not know.
REFORM – OTHERS HAVE DONE IT WHY CAN’T WE?
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SOFT TISSUE COMPENSATION AWARDS IN IRELAND – THE REAL COST
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THE PERSONAL INJURIES COMMISSION – WHAT YOU NEED TO KNOW – PART 1
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THE PERSONAL INJURIES COMMISSION – WHAT YOU NEED TO KNOW – PART 2
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