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Press release – 18 April 2018

Alliance for Insurance Reform calls for prosecution for false or misleading personal injury claims

 

Alliance to present proposals for meaningful insurance reform to Oireachtas Committee on Business, Enterprise and Innovation.

 

The Alliance for Insurance Reform, the group which brings together representative bodies from the not-for-profit, charity, sports and small and medium-sized business sectors across Ireland, will today present a suite of practical measures to tackle crippling insurance premiums when it appears before the Oireachtas Committee on Business, Enterprise and Innovation.

 

The Alliance, comprising of 20 civic and business representative organisations from across Ireland, represented by 35,000 members, over 633,000 employees and 41,300 volunteers, was formed this year in response to the spiralling cost of business insurance and the impact this is having on the viability of businesses, sporting organisations, festivals and charities.

 

The proposals cover areas of prevention, consistency and transparency in how liability and motor insurance claims are addressed including a call for an automatic referral to the Gardaí for prosecution for a plaintiff that knowingly gives or adduces evidence that is false or misleading in a personal injury claim. Other proposals include a call for a Garda insurance fraud unit to be established immediately; regulation of claims harvesting websites, also known as ambulance chasers; and a requirement for judges to set out detailed reasoning for payouts on injury claims which are in excess of the general guidelines.

Peter Boland, spokesperson for the Alliance, said:

“Excessive insurance premiums are pushing Irish businesses and civic organisations to the brink and efforts for reform have been halted by vested interests including the legal profession and insurance industry. The Alliance for Insurance Reform has come together as a group to set out practical, achievable steps to reduce spiralling costs for our members. Since the launch of the Alliance, we have met with the Minister and numerous state bodies and officials and yet no progress is visible. If this Committee wants to have a real impact on sharply rising business costs, then it must act on our proposals with a sense of urgency.”

The Alliance for Insurance Reform is also calling for:

  • The Statute of Limitations on personal injury claims be reduced from 2 years to 1 year
  • Change to the approach in calculating the Book of Quantum
  • Reinstate the Blue Book, the former insurance statistics publication
  • Individualised explanations to policy-holders for how premiums are settled
  • Notification to policyholders about the progress of claims against them
  • National Claims Information Database be given to the Personal Injuries Assessment Board and not The Central Bank

 

ENDS

 

EXTRACT FROM SUBMISSION TO BUSINESS COMMITTEE – SUMMARY OF TEN POINT ACTION PLAN

 

The actions we are suggesting are in the areas of Prevention, Consistency and Transparency. We believe them to be just, proportionate, feasible, achievable within a limited timeframe and ultimately, effective.

They are as follows:

PREVENTION

To quote a member of the audience at a public meeting we held in Cork in February, “if I had a need for big money and I had a choice between robbing a bank and faking an injury, I’d pick the fake injury every day. More money and no consequences if I’m found out.” We absolutely acknowledge the right of genuine claimants to fair compensation. But people have accidents all over the world. It is the consequences for Irish policyholders that appear unique.

  1. Link Sections 26 and 25 of the Civil Liability and Courts Act 2004

We want an amendment to the Act such that if a case is dismissed under Section 26 of the Act because the plaintiff knowingly gives or adduces evidence that is false or misleading, it must be automatically referred to an Garda Siochana for a prosecution under Section 25, which penalises such an offence with a substantial fine or imprisonment or both unless a defendant deliberately falsely accuses a plaintiff of giving such evidence.

  1. Establish a Garda Insurance Fraud Unit

The CIWG Motor Insurance Reports promised a dedicated Garda unit to focus exclusively on the investigation of insurance fraud. We want the Unit established as a matter of urgency. The Minister tells us that there is not enough support in the House for this. If this is the case, we urge any opposing parties to clarify their concerns and resolve whatever blockages exist.

  1. Regulate claims management companies (claims harvesters)

Our members tell us that claim harvesting websites are acting as the ambulance chasers of old, pursuing potential claimants with promises of money to be made, regardless of how dubious the claim is and with no costs or consequences. They are adding fuel to the fire of fraudulent, exaggerated and misleading claims and must be regulated by the State in order to protect policyholders and society as a whole. In particular, any referral fees they might charge to refer live cases onto solicitors must be banned outright. It is not sufficient that Government pass this onto the LSRA which is still in the process of establishing itself. Regulation must be brought forward now.

  1. Amend Sections 7 & 8 of the Civil Liability and Courts Act 2004

We ask that two amendments be introduced to the Act:

a) that Section 7 relating to the Statute of Limitations on PI claims be reduced from 2 years to 1 year. As the average time for a claim to be registered with PIAB following an accident is 9 and a half months, this will not disadvantage claimants. But it will mean that policyholders premium reserves will be one year shorter than is currently the case.

b) the language of Section 8, which purports to oblige a plaintiff to inform a defendant about an incident within 2 months, is so conditional as to be useless and is ignored in our experience. We ask that it is tightened up so that judges must take into account any delay in notification before allowing a case to proceed. The Department of Finance have said they are pursuing this with the Department of Justice but we want it done urgently.

CONSISTENCY

As documented elsewhere, the general damages awarded for minor injuries in Ireland bear no relation to those made in other countries which makes Ireland a very attractive place to have a minor accident. Additionally, there is no consistency between awards for identical injuries within the jurisdiction which makes it very attractive in personal injury cases to reject a PIAB offer and head for the courts, safe in the knowledge that with the right judge, the rewards may be substantially better.

  1. Change the Approach to Calculating the Book of Quantum

The Court of Appeal has already established that the ceiling on general damages for catastrophic injuries is €450,000. They have also established that the concepts of common sense and proportionality are central to the principles of proper compensation. We call for a revised book of quantum calculated on that percentage disability basis as a matter of urgency through the Personal Injuries Commission which is currently only looking at solutions for motor whiplash claims. Government should extend its remit to all injuries immediately.

  1. Encourage Consistency Among the Judiciary

The 2004 Civil Liability and Courts Act should be amended to require judges who award damages in excess of the Book of Quantum to set out a detailed reasoning for doing so.

TRANSPARENCY

The insurance industry is of systemic importance to the proper functioning of Irish society and is enshrined as such in much legislation and regulation. And yet there is virtually no transparency in this market either at industry or individual policyholder level.

7. Control the data coming from the new National Claims Information Database

We demand that control of analysis and reporting of the National Claims Information Database be given to the Personal Injuries Assessment Board rather than the Central Bank. PIAB has the expertise and funding necessary and no additional legislation would be required as Section 54 and Section 55 of the PIAB Act of 2003 already allow for this function.

8.Reinstate the Blue Book

Equally, we insist that the Blue Book be immediately reinstated and enhanced to restore the only transparency there previously was in the market before the Central Bank discontinued it in 2016.

9. Scrap and revisit the agreed Large Increases Protocol

The very first Recommendation in the CIWG Motor Insurance Report was that Insurers set out reasons for large increases in premiums to consumers. The Protocol produced from this recommendation was one of the first actions to be ticked as completed in the CIWG Updates. However, the Protocol as agreed between the Department of Finance and the insurance industry is a good example of how the CIWG is being strangled. We would be better off without it as it only creates the impression that something has been achieved when it hasn’t. We want a meaningful protocol agreed for both motor and liability insurance policyholders that individualises explanations with clear calculations showing the basis of premium charges.

10. Reinstate the 2003 IIF/IBEC Protocol on Dealing with Claims

Almost a year was spent by the Department of Finance and Insurance Ireland talking in circles about a protocol for notifying policyholders about the progress of claims against them before the Department discovered a pre-existing protocol agreed by Insurance Ireland’s predecessor the IIF and IBEC in 2003. The insurance industry is now resisting it being implemented anew. We demand that it is implemented immediately, backed by legislation, for both the motor insurance and liability insurance sectors.

________________________________________________

 

20th March 2018

Fury over lack of insurance reform

Policy holders have been ‘thrown to the wolves’ by Government

The Alliance of insurance Reform has expressed its intense disappointment at the slow pace of reform in the insurance and judicial industries following a meeting with Michel D’Arcy TD, Minister of State with special responsibility for Insurance at Government Buildings today.

Speaking after the meeting, Eoin McCambridge of McCambridges of Galway and director of the Alliance said:

“The Government promised  ‘to identify immediate and longer term measures which can address increasing costs’, when they launched the Cost of Insurance Working Group in September 2016. We turned up at Government Buildings today expecting news on significant actions. What we have got instead is death by a thousand consultations and the dead hand  of vested interests . The hard-pressed motorists, charities, voluntary groups, sports clubs and businesses around the country cannot wait for reform.  It must happen now.

The Government has been hoodwinked into believing motor insurance premiums are on the way down. In reality, they are up 42% since January 2014, with increasing numbers of young drivers and owners of older cars unable to get insurance at all.

Meanwhile, charities, voluntary groups, sports clubs and businesses are reporting enormous increases in their liability insurance premiums, a crisis happening behind closed doors due to the lack of any data from the secretive insurance industry. We feel like we’ve been thrown to the wolves by the Government with no real help in sight.”

 

Ivan Cooper, Director of Advocacy with The Wheel (Ireland’s national association for community, voluntary and charitable organisations) said after the meeting:

“The insurance issue is increasingly impacting on our members in terms of their costs and the restrictions placed on their activities by insurance policies. This situation is unsustainable as it is a block on voluntary organisations who want to contribute to Irish society. We are calling today for an acceleration in the pace of reform in the industry.”

Also speaking after the meeting was Peter Boland of the Alliance for Insurance Reform. He said:

 “The CIWG Reports are now littered with examples of positive-sounding actions that have been interminably delayed or neutered. For example, a protocol was proposed that would oblige insurance companies to notify a policyholder of claims made against them before settlement. This was supposed to be in place since the end of 2017 but has disappeared into the  ether.  

Likewise, a Garda Unit specialising in insurance fraud and funded by the insurance industry was due to be in place by the end of last year. Again, this has disappeared without trace.

Furthermore, what has been completed is completely unsatisfactory. For example the insurance industry was to be compelled to explain large premium increases to motorists. Instead, what was agreed between the industry and the Department of Finance was a blend generic statement that will be sent out with every premium increase and is a masterclass in saying everything and saying nothing.  (https://www.aig.ie/existing-customers/renewal-quote-explained)

“Overall, the Government’s CIWG is turning into a long-term process and there is no point in a long-term process to address an urgent issue. The actions the Alliance are focusing on are ones we believe to be just, proportionate, feasible, achievable within a limited timeframe and ultimately, we believe, effective.”

The actions the Alliance wants taken right now are :

PREVENTION OF FRAUDULENT, MISLEADING AND EXAGGERATED CLAIMS

  • Link Sections 26 and 25 of the Civil Liability Act 2004 so that if a claim is dismissed because it is false or misleading, it is automatically referred to the Gardai for prosecution under Section 25.
  • Push on the establishment of the Garda Insurance Fraud Unit funded by Insurance Industry
  • Regulate claims management companies (claims harvesters)

CONSISTENCY

  • General damages to be consistent with comparable European norms
  • Tariffs for specific injuries to be proportionate with the Court of Appeal cap of €450,000 for catastrophic injuries
  • Consistency in the awarding of general damages among judges

 TRANSPARENCY

  • Transparent data on the insurance industry so that we can identify why the crisis is happening
  • Transparency from insurance companies on why individual premiums are increased
  • Transparency from insurance companies on how, when and why claims are settled.

Commented McCambridge, “It was agreed that the Alliance would meet the Minister and his team again soon to follow up on progress. We will be expecting a lot more action soon if reform is going to make any difference for our members”. 

 

ENDS

For media enquiries please contact:

Peter Boland, Alliance for Insurance Reform.

peter@insurancereform.ie

086 8266036

 6th March 2018

ALLIANCE FOR INSURANCE REFORM DEMANDS FINANCIAL CONDUCT AUTHORITY TO OVERSEE THE INSURANCE INDUSTRY

Policyholders being fleeced while Government dawdles

The Alliance for Insurance Reform has today lashed out at the negligible pace of progress in the Government’s Cost of Insurance Working Group and demanded that a statutory financial conduct authority be established to supervise the insurance industry on behalf of policyholders, in the wake of recent reports on the massive increases in insurance company profits.

Insurance group FBD Holdings last week declared profits of €44.9m for 2017 while RSA Insurance Ireland posted profits of €10.8m.

Reacting to the news, Eoin McCambridge, director of the Alliance for Insurance Reform said “Insurance companies are now declaring enormous profits again in Ireland and yet there has been no meaningful reform of the personal injury system they have been blaming for their woes. The same companies claimed to be ‘on their knees’ in 2014 yet now, despite no delivery on the personal injury changes they insisted were vital, they are rolling in money. These profits are being made off the backs of hard-pressed charities, voluntary groups, sports clubs and businesses trying to stay open against a background of unsustainably high insurance premiums. To be frank, it looks increasingly clear that Irish policy holders are being fleeced by the industry”.

Commenting on the progress of the Government’s Cost of Insurance Working Group, Peter Boland of the Alliance said “The Government promised real reform in the insurance market for the benefit of policy holders. However their fourth update on the cost of motor insurance, slipped out without a fanfare two weeks ago, makes it abundantly clear that their focus has shifted to protecting the insurance industry. Any of the meaningful actions in the Report designed to shed some transparency on this secretive industry have been further delayed by a combination of Government inaction and industry resistance.

“Furthermore, there has been no meaningful progress on key issues related to the prevention of fraudulent, exaggerated or misleading claims or on the issue of sky-high and inconsistent awards for personal injury.

“Our members feel that this Working Group is increasingly looking like a mechanism for getting the Government over the next election campaign without achieving any real reform of the industry, leaving the insurance companies and other vested interests free to continue fleecing us. This is why we are today calling for a financial conduct authority be established on statutory basis to supervise the insurance industry. This would be an authority capable of protecting the interests of policyholders, without bending to the representations of vested interests. The Central Bank is not capable of fulfilling this role as it is currently tasked. Its responsibility to support the sustainability the insurance industry means that it is too close to insurers to look after policyholders as well and is fundamentally conflicted.”

ENDS

The Alliance for Insurance Reform is holding three public meetings regarding the current insurance crisis in Galway, Limerick and Cork .

Thursday 8th February: Galway City

Time: 8pm

Venue: The Ardilaun Hotel, Taylor’s Hill, Galway

 

Friday 9th: Limerick City

Time: 8pm

Venue: The Strand Hotel, Ennis Road, Limerick

 

Monday 12th: Cork City

Time: 8pm

Venue: The Metropole Hotel, MacCurtain St, Cork

The meetings are scheduled to last one hour. The agenda at all three is as follows:

  • Presentation on Alliance
  • Research presentation
  • What we want
  • Suggestions Session – what changes will make a real difference now!

PRESS RELEASE 25.01.18

A Republic of Opportunity for the insurance industry and legal profession as Irish businesses and charities bled dry

The insurance industry and the legal profession breathe easy as Government report fails to take urgent action on crippling insurance premiums

The Alliance for Insurance Reform has criticised the Government’s latest report on the cost of  insurance published by the Department of Finance today.

Peter Boland, spokesperson for the Alliance said:

“Today’s report is an embarrassment to a Government that claims to be on the side of small business owners. Its main recommendations call for more reports and analysis while asking kindly for the insurance industry and legal profession to cooperate. The only Republic of Opportunity we see is the one exploited by the insurance industry and legal profession as Irish businesses and charities are bled dry.

It is clear that the vested interests profiting off the backs of Irish organisations have no interest in reforming a system that is driving big increases in profits for their shareholders. The Government needs to show backbone in taking on these sectors to project jobs and services across the country.”

The Alliance for Insurance Reform which was launched this week highlighted how today’s report makes it clear that the Department of Finance is biased in protecting the insurance industry. The report’s comment that “the Working Group always remained conscious of the need to ensure that a financially stable and solvent insurance sector is maintained”while not mentioning policy holders as a priority. This is an insult to struggling businesses and not-for-profit organisations.It is clear that the Government doesn’t have the same urgency to ensure financially and solvent SME and charity sectors.  The vast majority of the actions outlined in today’s report involve the production of feasibility studies, proposals, reports, options or detailed analyses. It gives the overall impression of being a holding document to avoid actual action.

Every day members of the Alliance for Insurance Reform receive an insurance renewal which is inexplicably increased from the year before. Every day there are jobs under threat, services reduced, and organisations forced out of existence in response to crippling insurance premiums from an out of control insurance industry and legal profession. It has been over 18 months since the Government first established their working group on insurance costs and no tangible progress has been made in reducing premiums.

A survey of 950 members of Alliance organisations, carried out by Amárach Research found that since 2013, nearly half (47%) of respondents have seen their premiums rise by over 30%, while over one fifth have even seen rises of over 70%. Two thirds of respondents also reported having increased excesses or new exclusions added to their policies -creating more risk and exposure to cost.

The top impacts of this on their organisations included inhibiting their ability to grow (47%), threatening the future of their organisation (45%) and making jobs less secure (25%).

The Alliance will be a voice for the interests of the policyholder who always comes at the bottom of the list after insurers and the legal profession and other vested interests. We are demanding urgent change that will:

  • prevent exaggerated and misleading claims being pursued and settled
  • deliver real transparency on how premiums are calculated as well as information on how, when and why claims are settled
  • give consistency in the calculation of awards

About the Alliance for Insurance Reform:

The Alliance for Insurance Reform represents not for profit organisations, charities and small and medium-sized businesses, highlighting the negative impact of persistently high premiums and is calling for real action to tackle the issue. Its members include:

  • AOIFE Ireland (Association of Irish Festival Events)
  • Car Rental Council of Ireland
  • Construction Industry Federation
  • Coach Tourism & Transport Council of Ireland
  • Galway City Business Association
  • Ireland Active
  • Irish Road Haulage Association
  • Irish Hotels Federation
  • ISME
  • Licensed Vintners Association
  • Motorsport Ireland
  • Playcentres Ireland
  • Quick Service Food Alliance
  • Restaurants Association of Ireland
  • RGDATA
  • Society of the Irish Motor Industry
  • Vintners Federation of Ireland
  • The Wheel (Ireland’s national association for community, voluntary and charitable organisations)

 

 

PRESS RELEASE 24th January 2018

Irish civic and business organisations unite to launch the Alliance for Insurance Reform

45% of organisations say that rising insurance premiums are threatening their future

 

The Alliance for Insurance Reform brings together 18 civic and business organisations from across Ireland, representing 35,000 members, over 620,000 employees and 41,300 volunteers to demand action to end crippling insurance premiums.

The creation of the Alliance is a response to countless stories from small organisations where services and jobs are being affected by excessive insurance costs.

The group which represents not-for-profit organisations, charities and small and medium- sized businesses, is highlighting the negative impact of persistently high premiums and is calling for real action to tackle the issue.

Peter Boland, spokesperson for the Alliance said:

“Persistently high, unsustainable insurance premiums are pushing everyday organisations to the brink and denying Ireland the voluntary and business services any civilised society might expect. The formation of the Alliance for Insurance Reform is on the back of intense frustration with unjust and persistent rises in insurance premiums and the clear lack of any meaningful results from the initiatives taken in the area so far. What is at stake is the survival of charities and voluntary bodies serving our country and the livelihood of Irish business owners and their staff. That is why we need action now.”

A survey of 950 members of Alliance organisations, carried out by Amárach Research found that since 2013, nearly half (47%) of respondents have seen their premiums rise by over 30%, while over one fifth have even seen rises of over 70%. Two thirds of respondents also reported having increased excesses or new exclusions added to their policies -creating more risk and exposure to cost.

The top impacts of this on their organisations included inhibiting their ability to grow (47%), threatening the future of their organisation (45%) and making jobs less secure (25%).

At the launch of the Alliance today, stark examples were given of the negative impact of excessive insurance premiums(see Notes to Editors).  One example is Eoin McCambridge of McCambridges food hall and restaurant in Galway:

“Rising insurance premiums are preventing McCambridges from investing in the business in terms of expansion, improvement and employment.In 2014 our insurance premium was €17,000. In 2017, it was €102,000. Within three years, McCambridges will be closed if premiums keep rising at the current rate.”

 

Eoin McCambridge added:

“The Alliance will be a voice for the interests of the policyholder who always comes at the bottom of the list after insurers and the legal profession and other vested interests. We are demanding urgent change that will:

  • prevent exaggerated and misleading claims being pursued and settled
  • deliver real transparency on how premiums are calculated as well as information on how, when and why claims are settled
  • give consistency in the calculation of awards”

The Alliance will be holding public meetings around the country in the next few weeks to gather feedback from companies and organisations on their experiences and on how they’ve been impacted.  When it has gathered this evidence, the Alliance will publish a very specific list of changes it believes are necessary to prevent fake claims, deliver transparency, ensure consistency and give policyholders a voice.

ENDS

 

For media enquiries please contact:

Michael Ward, Drury| Porter Novelli – michael.ward@drurypn.ie / 087 213 0445

Rob Hanly, Drury| Porter Novelli – Robert.hanly@drurypn.ie / 087 932 6887

About the Alliance for Insurance Reform:

The Alliance for Insurance Reform represents not for profit organisations, charities and small and medium-sized businesses, highlighting the negative impact of persistently high premiums and is calling for real action to tackle the issue. Its members include:

  • AOIFE Ireland (Association of Irish Festival Events)
  • Car Rental Council of Ireland
  • Construction Industry Federation
  • Coach Tourism & Transport Council of Ireland
  • Galway City Business Association
  • Ireland Active
  • Irish Road Haulage Association
  • Irish Hotel Federation
  • ISME
  • Licensed Vintners Association
  • Motorsport Ireland
  • Playcentres Ireland
  • Quick Service Food Alliance
  • Restaurant Association of Ireland
  • RGDATA
  • Society of the Irish Motor Industry
  • Vintners Federation of Ireland
  • The Wheel (Ireland’s national association for community, voluntary and charitable organisations)

 

W: www.insurancereform.ie

F: /insurancereformireland

T: @InsuranceRefIre

 

Case studies of Alliance members:

Stephanie Reid – Monkey Business

Stephanie owns and runs a children’s play centre in Galway city. Her insurance bill increased from €4,700 in 2016 to €8,275 in 2017. She outlined how there is a huge amount of anxiety within the business when the insurance is renewed every year. In the past she was deeply frustrated with the lack of communication from her insurance company where one previous claim was settled without her knowledge. She states that one serious claim and premium hike will close her business and put everyone employed by it out of a job.

William Hanley – Supervalu

William Hanley is the owner of a Supervalu store on the southside of Dublin. He has seen his annual insurance premium increase every year for the past 4 years. On top of his premium he also pays out an excess charge of €5,000 for each and every claim settled by his insurance company which adds a considerable amount to his annual insurance bill. The impact on these annual increases is to put jobs at risk at renewal time every year. William is highly frustrated by how insurance companies don’t tackle exaggerated and vexatious claims.

Colm Croffy – Association of Irish Festival Events (AOIFE)

Colm Croffy is the Executive Director of the Association of Irish Festival Events. His members have seen insurance costs hiked up by between 8% and 12% over the past three years. If this trend continues then a large number of festivals and outdoor events will be forced to cease operations with a massive knock on impact for local economies. The increasing health and safety obligations on organisers of outdoor events is also leading to events becoming less innovative and more restrictive.

Ivan Cooper, The Wheel

Ivan Cooper is Director of Public Policy at The Wheel, the national association of community, voluntary and charitable organisations. According to Ivan, the cost of insurance is a huge issue for many charities, with the cost of insurance absorbing ever-increasing quantities of scarce resources. “Fifty of The Wheel’s members have already informed the organisation that their insurance premiums have increased in the past three years, in some cases by as much as 500%. Most charities need public or employer liability insurance, and sudden increases can threaten the ability of organisations to deliver important services in communities. Bringing the cost of insurance down – and indeed ensuring continued availability of cover – is now an urgent matter for many charities,” said Mr Cooper.

Oh come on!

We want the law changed so that if a case is dismissed 'because the plaintiff knowingly gives or adduces evidence that is false or misleading', it must be automatically referred to an Garda Siochana for a prosecution.
https://t.co/QmtAoQ8DcQ

Not acceptable for @centralbank_ie to deprive citizens of this data.
It shows Solvency II is their only priority.
We need @ecb @CCPCIreland and @IRLDeptFinance to show the way

@BreakfastNT @RTEbusiness @petulamartyn @michaeldarcy @CWeston_Indo @eoinbk https://t.co/k6ihrzPsWO

Action group calls for insurance fraud garda unit to be set up immediately
https://t.co/2wk8HKWqZF

"The bank said the information in the new report exceeded in many instances that in the blue book"
@centralbank_ie took away the only bit of clarity on the secretive insurance industry and replaced it with an impenetrable mess, We want the Blue Book back! https://t.co/1Mqc9V95RO

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