New rules to halt 'double' compensation payouts
Published 28/07/2014 | 02:30
RECIPIENTS of compensation in personal injury cases will no longer be able to receive payments from both insurance companies and the Department of Social Protection under new rules.
The crackdown by the Department, called the Recovery of Certain Benefits and Assistance (RBA) scheme, comes into effect on August 1.
The scheme, which is part of the Social Welfare and Pensions Act 2013, is intended to stop recipients of such payments from receiving "double compensation".
The new law will affect cases where a compensator, normally an insurance company, is paying compensation to a person who is also in receipt of a social welfare payment for the same injury or accident.
Insurers will now be required to get a statement from the Department of Social Protection before compensation has been paid.
The statement will set out any recoverable benefits that have already been paid by the Department. These will then be refunded by the compensator.
The change follows recommendations made by the Law Reform Commission and is similar to provisions in place in the UK and in the North.
"The fundamental principle which underlines the introduction of the new arrangement is to avoid 'double compensation' – to ensure that a person is not compensated twice over in respect of the same accident, injury or disease," the Department said.
The change also means the insurance company can no longer deduct the amount paid in welfare benefits from the total amount of compensation awarded.