Call for super tax on insurers who are accused of turning Ireland into ‘treasure island’ (via

By Charlie Weston

Insurance companies have been accused of turning Ireland into “treasure island” with claims they are on course to make super-profits this year.

The Alliance for Insurance Reform called on the Government to do more to boost competition in the market.

And the chairman of the Consumers’ Association of Ireland, Michael Kilcoyne, said it might be time to consider a super tax on insurers after two of them raked in profits of €150m between them.

FBD reported higher-than-expected profits before tax of €110m for last year and said it would pay a dividend worth €35.3m to its investors.

Aviva saw its profits for homes and motor cover rise by 34pc to €43m last year.

It said it had reduced premiums in line with the new personal injury guidelines agreed by judges, with expected lower costs for minor injury claims.

This week Tánaiste Leo Varadkar said the average awards for personal injuries had fallen by 50pc since revised guidelines on the calculation of the awards were introduced.

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New law to allow Irish consumers to bring class actions in High Court (via Irish Legal News)

Irish consumers will be able to bring collective claims to the High Court under new legislation announced by ministers yesterday.

The legislation will transpose into Irish law a proposed new EU directive aimed at facilitating coordination and effective action from national consumer authorities at EU level and reinforcing public enforcement action and better protection of consumer rights.

The new mechanism has been dubbed the “European class action” and will allow designated qualified entities to take enforcement action in the Irish courts on behalf of a group of consumers whose rights have been breached either in Ireland or in another EU country.

However, the government rejected comparisons with the US class action model, highlighting that only not-for-profit organisations will be able to apply for designation as qualified entities and thus be able to use the procedural mechanism for representative actions.

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PIAB ratchets up fees to offset €3.5m deficit (via Business Post)

Personal Injuries Assessment Board says cost increase for insurers will expand service and won’t affect premiums

By Michael Brennan, 28th March 2022

The Personal Injuries Assessment Board (PIAB) is hiking case fees from €600 to €1,000 to reduce the multimillion euro budget deficit at the government body.

PIAB charges a fee to insurance companies for processing personal injury claims at low cost, rather than dealing with them in court.

It has run up a €3.5 million deficit during the pandemic due to increased costs and a ban on carrying out medical inspections of personal injury claimants during public health restrictions.

A PIAB spokesman said the new fee of €1,050 was a return to what PIAB had been charging before it was cut to €600 in 2013.

He said the fee was needed so that PIAB remained “financially sustainable” and to pay for new services such as mediation.

PIAB has insisted that the increased fee for insurance companies to use its claim processing service should not lead to increased insurance premiums for individuals and businesses.

The spokesman said the additional fee income would allow the body to resolve more cases with far lower costs.

“It is not envisaged that this fee change will have any effect on insurance premiums – on the contrary by enabling more cases to be handled by PIAB, the savings to all parties will grow,” he said.

According to PIAB, around one third of personal injury claims end up in court, with the remaining two thirds dealt with by PIAB itself. Legal costs account for 67 per cent of the cost of motor insurance claims settled in court compared to just 4 per cent of the cost of claims settled in PIAB. Legal costs are adding around €16,000 to the average cost of a claim settled in court, which amounts to €40,000 compared to €24,000 for a PIAB claim.

PIAB is self-funded, but it had a deficit of €1.5 million in 2020 and €3.5 million last year. It had to be given a €2 million payment in the budget by the government to reduce its deficit for this year.

PIAB charges a much lower fee of €45 for personal injury claimants who submit their cases to the board. According to its latest annual accounts, insurance companies paid €6.9 million in fees in 2020, while claimants paid around €1.5 million.

Insurance companies have accepted the new fee increase without complaint. Insurance Ireland, which represents companies in the sector, said that PIAB would soon be taking on psychological injuries and other more complex cases that it had not deal with before.

“We appreciate that this expansion of services must be funded. The fee increase is effectively a restoration of the €1,050 fee, which applied some years ago,” said a spokeswoman.

Last year, the Judicial Council published new personal injury guidelines which have led to a further 40 per cent reduction in the size of awards made by PIAB. The Insurance Ireland spokeswoman said motor insurance premiums had reduced by 11 per cent in the past 12 months, despite soaring inflation in many other areas of the economy.

“Insurance Ireland and our members would hope that any increase in the fees charged by PIAB would be offset by savings in legal costs by virtue of more claims being assessed by the PIAB and greater use of PIAB as a resolution to claims,” she said.

PIAB used to have a large surplus of more than €9 million in its bank account, which it had built up over a number of years. However, according to its most recent annual report, it paid over €9 million to its parent department, the Department of Enterprise after considering its “operating, contingency and future capital requirements”. The government had passed legislation in 2019 to allow it to claw back money from PIAB.

The PIAB spokesman said that the board did not intend to build significant reserves into the future beyond what was required. “Should the fee generate more income than is required, it is intended that the fee would be reduced again and it will be reviewed on a regular basis,” he said.