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PIC Report Falls Short of Real Reform

The recent reported published by the Personal Injuries Commission (PIC) has addressed some of the concerns and challenges facing the Insurance sector and policy holders. ISME has acknowledged the positives within this publication such as:

  • The report formally acknowledging the very obvious fact that quantum paid in Ireland far exceeds that paid for comparable injuries in other jurisdictions. The analysis of awards paid in Ireland and the UK carried out by KPMG provides a stark comparison of the costs borne by policy holders in each jurisdiction.
  • There is effectively zero law enforcement activity taking place against fraudulent claims. The PIC acknowledges that crime in this area is becoming more sophisticated, and is attracting criminals from outside the jurisdiction.
  • The sense of urgency evident in the report, suggesting that action is needed soon to stem the unjustifiable economic flows generated by excessive awards, false and exaggerated claims, and legal costs.

However, we have also highlighted the shortcoming of the publication, such as:

  1. The PIC being unable to explain why Irish awards are higher than the UK (and other jurisdictions); yet it is commonly accepted in Ireland that the judiciary are the prime movers in the establishment of levels of quantum.
  2. The PIC suggesting that the judiciary, in the form of a yet-to-be-established Irish Judicial Council, should provide ‘guidance for judges in measuring general damages for personal injury…’ It further states ‘The PIC acknowledges that the judiciary are the correct source of guidance on the appropriate levels of damages and are empowered in reaching their decisions to take in factors such as the Court of Appeal decisions and the output of this report.’
  3. Thirdly, and most worryingly, the PIC essentially follows the line suggested in the second report of the Cost of Insurance Working Group (CIWG), that introducing legislation for the regulation of general damages should be a matter for consideration by the Law Reform Commission. Given the very significant program of law reform already under way by that body, this proposal is a recipe for kicking the insurance can at least four years down the road.