New Bill aims to cap insurance payouts and reduce premiums – Lawlor

Fine Gael Senator Anthony Lawlor has introduced a Bill to cap the level of insurance pay outs for personal injury claims.

The Kildare Senator said the Civil Liability (Capping of General Damages) Bill 2019 will help to reduce premiums for motorists.

Senator Lawlor said: “Insurance costs must be kept at a reasonable and affordable level.  Increases in the cost of insurance and in particular the rising costs over the last four to five years are a real issue for people and businesses.

“Reducing the cost of living and business costs is a priority for me and this Bill aims to achieve this by moderating the size of claims payed for general damages.

“I believe the excessive awards currently being paid for soft tissue injuries are having a direct impact on the cost of insurance.

“Up to 70% of insurance premiums are claims related.  I believe that awards should better reflect the level of injury suffered. We must review the guidelines and make changes that reflect the link between awards and insurance costs.”

Senator Lawlor continued: “According to the second Motor Insurance Key Information Report (2016) the vast majority of claims inflation comes from smaller third-party injury claims, the cost of which increased at an average rate of 7.3% per year, up 42% in total from 2011-2016.

“Third party injury costs per claim are £11,000- £13,000 in the UK compared to €40,000-€60,000 in Ireland.  The most frequent claims are mainly soft tissue or “whiplash” according to the latest data from Insurance Ireland.

“In 2018 according to the AA the average premium in Ireland was €998. The average price paid for motor insurance in the UK was £477 down 1% on the previous year.

“The significant annual increases that many people were seeing in 2015 and 2016 have largely eased, however the majority of motorists are still paying more for their cover than they would have in previous years.

“According to the CSO, the average motorist still pays about 30% more than in 2015.”

Concluding, Senator Lawlor said: “Latest figures indicate a 42% rise in pay-out costs between 2011 and 2016; this is not sustainable and has to be moderated immediately.

“I want to put money back in people’s pockets and protect jobs and businesses and this Bill is an important part of this process.”

ENDS