SHOPKEEPERS and business owners are celebrating today after the Government decided to shoot down proposals to jack up insurance claim pay outs by 17 per cent.
The Judicial Council recently put forward a proposal to increase the guidelines for personal injury awards by 17 per cent in line with inflation.
The idea of increasing insurance claim payouts by 17 per cent was recently suggested[/caption]
Brian Hanley praised Justice Minister Jim O’Callaghan for his decision[/caption]
Justice Minister Jim O’Callaghan had been expected to sign off on the proposed increases before the Dail broke for the summer.
However, the Fianna Fail TD has instead slapped down the judges’ recommendation and will leave the payout guidelines as they are.
Minister O’Callaghan brought a memo to the Cabinet sub committee on insurance which outlined his decision.
However, he warned that leaving the guidelines as they are could create an issue where judges can hand out higher pay outs while the Personal Injuries Board would be stuck to the guidelines.
The decision to not hike up the guidelines was met with jubilation by business owners today who had been warning the Government that increasing payouts could force some firms to close their doors.
Brian Hanley from the Alliance of Insurance Reform praised the Minister for the important decision that will help prevent premium prices from skyrocketing.
The insurance industry expert had recently written for the Irish Sun to warn about the impact of rising pay outs and urged the Minister to step back from the brink.
Speaking today, the Alliance of Insurance Reform boss called on the Coalition to go one step further and ensure that insurers drop their prices for customers.
He said: “In terms of liability insurance for businesses, sports, community and voluntary groups we have seen substantial decreases in the volume of claims and the size of awards.
“It is unconscionable that insurers have chosen not to pass on savings to customers, choosing instead to prioritise profits over their policyholders.
“All appropriate pressure must be brought to bear on them by our elected representatives and we look forward to seeing how the next action plan for insurance reform will address this key issue.”
Retail Excellence which represents hundreds of shops across the country hailed the move as a lifeline for struggling businesses.
They said: “A proposed blanket increase in personal injury awards would have been a regressive step and would have led to even bigger premiums for businesses and customers, at a time when the cost of doing business is soaring.
“Even as the amount and value of claims have fallen, insurance companies have shown time and time again that they will prioritise profits over their policyholders.”
