Tuesday 23 July 2019

'In 40 years of business I've never seen anything like this' - owner fears closure as claims cause 428pc insurance hike

Martin Mulligan with Mary his Wife Pic Kevin Mc Nulty
Martin Mulligan with Mary his Wife Pic Kevin Mc Nulty
Amy Molloy

Amy Molloy

The owner of a family-run convenience store says in his 40 years of business he has never seen anything as bad as Ireland's current insurance crisis.

Martin Mulligan, who also runs a petrol station and post office in Athlone, Co Westmeath, recently had his insurance premium hiked by 428pc.

He was notified by his insurance broker 10 days before the premium was up for renewal that it had increased from €7,000 to €30,000.

Mr Mulligan says there are a couple of personal injury claims pending against his store and now fears his business is heading down a "black hole".

Martin Mulligan at Mulligan's service station Pic Kevin Mc Nulty
Martin Mulligan at Mulligan's service station Pic Kevin Mc Nulty

"We are entirely at the mercy of non-controllable claims lodged against us," he told the Irish Independent.

"Even where we feel certain claims are spurious, they are still used by the insurer as a basis for increasing premia over time.

"We run a post office, convenience store and filling station and we just don't make that kind of money to cover these crazy insurance costs. If we don't get solutions quick, I fear for the future of our business and many across rural Ireland."

The father-of-three is head of the National Federation of Retailers - an organisation which represents 15,000 retailers throughout Ireland.

He accused the Government of having a laissez-faire attitude towards the behaviour of the insurance industry and legal profession - an attitude that is "killing businesses".

"The leaders of the main political parties tell you 'thank you for your email' but they're not doing anything to address the issue," he said.

"It's sad to see rural Ireland and businesses being decimated. We're very quick to copy the United Kingdom on things like sugar tax but when it comes to introducing positive changes for small businesses and lower awards of minor injuries, well that's a different story altogether."

Mr Mulligan said if his convenience store closes, the 24-hour ATM will also have to shut, as will the post office.

He said his staff have been very supportive but they fear how insurance costs will affect their jobs.

He employs 16 staff, all drawn from the local area.

"Like every business, we have been subject to public liability claims over the years. Our insurance company has managed the litigation process for these claims and has sought limited if any involvement or input from us, the insured party.

"We have seen an increase in public liability claims in recent years. Some of these claims are at an early stage; others have been settled by our insurer. None of these claims have been tested definitively in court with a finding in favour of the claimant.

"The premium quoted for our most recent insurance renewal represents a greater than fourfold increase compared to last year. In addition, the level of insurance excess has increased from €1,000 to €25,000. In effect, this means that the cost of any first claim to our business will be €55,000. Essentially, the insurer is increasing the cost of their cover while paradoxically reducing the level of cover provided."

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