ISME held a meeting in Portlaoise on 16th May to voice concern at the failure to make any meaningful progress on the insurance reform issue. Several trade associations and their members joined us in Kavanagh’s Bar to register their disquiet at Government failure to follow up on the recommendations of the second and final report of the Personal Injuries Commission, chaired by Mr Justice Nicholas Kearns.
Central to Justice Kearns’s summary recommendations was an imperative to reduce the quantum in personal injuries awards as a matter of urgency. That report was published in July, and it signalled the intention by the Government to have a Judicial Council in place by the end of 2018, with the express intention of reducing quantum. He also stated explicitly that the extraordinary amounts of money paid for minor injuries in Ireland were attracting criminals and fraudsters from within and outside the country. In view of the urgency of the situation, Justice Kearns suggested the need to have an interim Judicial Council in place quickly. There has been no significant legislative progress on the issue to date.
Solicitor Paul McMahon addressed the group, and debunked some of the myths surround the insurance cost issue, such as the notion that there is a constitutional bar to capping general damages. There isn’t, and a 1961 statute already provides a cap on damages in the case of fatalities. In any case, judges have only been assigned responsibility for setting damages since 1989.
In his recent address to the PIAB conference, Justice Kearns said that a bill capping damages, that did not exclude the judiciary from its functioning, would be likely to withstand challenge on constitutional grounds. The text of Justice Kearns’s speech can be found here
What stood out to all attendees at this morning’s meeting was the extreme duress many of them are under to renew insurance cover. Some people said their business had only days of cover left, and they were unable to take bookings for June.
Another speaker said that her business was operating without insurance, because she couldn’t get any, but the business was the only livelihood she and her employees had.
Some contributors were clearly emotional and under a great deal of stress.
One after another voiced their concern that Government promises to do something by the end of this year, or early next year, will simply be too late for them. They face imminent closure.
Attendee Shane Holohan from Taking Flight spoke about how his business is being ripped apart because he can’t secure public liability insurance. We started having serious issues with our insurance about two years ago. We had gotten used to our insurance premium doubling year on year and then two years ago, public liability insurance disappeared. I secured one quote from a broker here and the premium went from €1000 to €16,000 in one year. I had to then go outside the country to Wales where we got a broker. I just found out two months ago that the underwriter there isn’t going to renew our policy. I now can’t plan for the future; I can’t plan for summer camps because from mid-July we don’t have public liability insurance. The irony of the whole thing is we can secure insurance for individual teachers so while you or your child is up in the air, you’re covered, but you simply walking in the door – you are not covered – it’s basically ripping the business apart. We haven’t even had any claims against the business.’
Daniel Hickey of AllinAll Ingredients said ‘We were promised some years ago by Enda Kenny when he was Taoiseach that Ireland would be the best little country to run a business in. Today, not only have the Government lost control of the cost of running the country but as is being highlighted today they have utterly failed to deal with the everyday problems businesses are facing with sky rocketing insurance premiums, and in some cases an inability to get cover thereby putting them out of business. No more promises only action is what is required.’
Elaine Mullally from Clown Around Play Centre Ltd said ‘We had a great meeting this morning – it is clear we need the Garda Fraud Investigation units working in Ireland and the book of Quantum must be revised as a matter of urgency, otherwise a huge section of enterprise in Ireland will be wiped out over the next 24 months’
Kevin Bracken is concerned about the escalating costs of insurance and the pressure these costs are putting on business. ‘I have two Maxol forecourts service stations, I’m in business since 1987 and for the first 27 years I had no personal injury claims on any of my premiums, the only reason I would have been taking out insurance would have been to cover me for break ins and robberies. Now my main concern is personal injuries, in the past 5 years we’ve had 5 successful claims against us. As a result, in every area of my business I am constantly watching, to the point where we are now paranoid. One of my businesses had a policy three years ago for €3800, last year that rose to €8100, this year I just don’t know what that figure will go to. There is no clear path to see where these figures come from.’
ISME and the other members of the Alliance for Insurance Reform sincerely hope that not too many more businesses will have to go under before Government accept there is a real crisis in business insurance.