New personal injury award guidelines to replace the book of quantum will be published by July 2021 as part of the government’s action plan for insurance reform, which was revealed today (December 8).

The 66-point action plan also includes a measure to place perjury on a statutory footing, making the offence easier to prosecute.

Other actions include the enhancement and reform of the role of the Personal Injuries Assessment Board, which will no longer be responsible for preparing a book of quantum.

The action plan also includes a commitment to recognise the work of the Personal Injuries Guidelines Committee, under the Judicial Council, in providing guidance on personal injury claims. The government said that it monitor whether insurance awards need to be capped.

Under the new insurance reform plan measures, the Competition and Consumer Protection Commission (CCPC) will also be given more enforcement powers.

In Association with

In a foreword to the action plan, enterprise minister Leo Varadkar (pictured) said that the publication aims to alleviate the insurance-related pressures faced by businesses and families as the economy reopens after the Covid-19 pandemic.

“Insurance is an essential financial service for businesses, consumers and voluntary and sporting groups across Ireland. Nonetheless, there have been a number of well-publicised issues surrounding the high cost of and difficulty getting insurance in recent years, and if this continues it could cause great harm to both society and our national competitiveness,” Varadkar added.

“This action plan … crosses over different policy areas such as justice, finance [and] competition, and is focused on reducing costs and fraud, and increasing transparency. Each important on their own; put together will ensure the change we all want.”

Varadkar also indicated an intention to have quarterly updates on the timelines for action mentioned in the report. Plans are also afoot to set up an office within government to encourage greater competition in the insurance market.

Timeline Concerns

The Alliance for Insurance Reform (AIR) welcomed government’s insurance reform plan but expressed concern at the timelines involved. “As a declaration of intent, this plan ticks all the boxes. But progress on real insurance reform has happened at a snail’s pace and the majority of the proposals in the action plan have been doing the rounds since the start of 2017,” said AIR director Eoin McCambridge.

“That is four years of unsustainably high insurance premiums closing down businesses and stopping voluntary groups from doing what they volunteered to do. We call on the government to not treat the timelines in this plan as targets to be aimed for.”

Separately, Insurance Ireland also welcomed the action plan’s publication, which it said will bring focus to reducing the cost of claims in the market for the benefit of policyholders.

“Insurance Ireland particularly welcome the recognition of the Personal Injuries Guidelines Committee under the Judicial Council to provide guidance on personal injury claims, as well as the monitoring of whether insurance awards need to be capped,” said Moyagh Murdock, chief executive of Insurance Ireland.

“We are very pleased to see the action around enhancing PIAB and would like to see this being progressed as quickly as possible. It is crucial that we see a strengthening of their ability to settle cases so that less claims go to the courts, where the legal costs add so much to the overall cost of settling claims.”

Murdock added that another welcome action is the commitment to tackling insurance fraud. “While the vast majority of claims are genuine, the reality is that the high levels of compensation awards is an incentive for fraudulent activity, and we believe the converse will be the case once the high cost of claims has been reduced.”