'We're losing our culture' - nightclubs shut down, dance floors closed and alcohol prices soar due to rising insurance costs
- Bar and nightclub owners say the industry is being 'killed' by insurance costs
- 'Tooth fairy case' - customer brought compo claim for a trip and fall but CCTV showed her being punched in face
- Pub owners calling on Government to intervene and establish Garda Insurance Fraud Unit
- 'Insurance costs are forcing us to change our culture, changing how we are as people'
PUB and club owners are being forced to close dance floors and increase alcohol prices in an attempt to offset rising insurance premiums.
They claim that the cost of defending "spurious" claims which are "decimating" the nightlife industry are forcing them to take drastic action.
Noel Anderson, managing director of Lemon & Duke in Dublin city centre, says he has completely changed the model of his business in an attempt to combat soaring insurance costs.
Anderson collaborated with Irish rugby stars Sean O'Brien, Jamie Heaslip and brothers Rob and Dave Kearney to open Lemon & Duke in 2016.
He also managed the venue's predecessor, The Grafton Lounge. But he has now swapped the dance floor and late opening times for a more insurance-friendly option.
"The late night club scene is coming to an end now and it’s become too risky to have a dance floor. Our closing time is now around 1.30am, whereas we used to stay open later. If you’re staying open past 1.30am you’re leaving yourself open to trouble," he told Independent.ie.
"Around eight years ago we had a trip and fall case at one of the venues I manage and it caused our insurance to go through the roof. The guy had a pre-existing injury and it took five years for the case to go through the courts. We ended up settling on the day in the High Court.
"That meant our insurance was going up every year as the cost of it was sitting on the premium."
Despite taking action to help reduce "risk" situations, the venue's insurance premium is a staggering €36,000 more than it was eight years ago.
Anderson is a member of the Licensed Vintners Association and has been working together with the Alliance for Insurance Reform to try and highlight how insurance costs are "killing" small businesses in Ireland.
"All this is having a knock-on effect on the nightclub industry, the industry is being decimated," he said.
"There are genuine claims out there and accidents happen, people make mistakes and you have to accept liability, but there is a lot of nonsense going on too.
"Insurance costs are forcing us to change our culture, changing how we are as people. We are killing the industry and the small business owner. You see people complaining about how expensive drinks are in Dublin and how they have to pay nearly €10 for a gin and tonic, but between rates and excessive insurance costs, you have to charge that much for drinks or you won’t survive.
"People always say 'oh well in Spain you can get a pint for €3.50', but Spain doesn’t have the same issue with insurance as we do.
- Read more: Nightclub owner forced to close down family business after 120 years: 'The insurance broke me'
"We haven’t had any claims here now in about three years but our insurance premium doesn’t reflect that whatsoever."
Another owner of a popular Dublin bar, who gave a presentation in the Dáil on some of the "ridiculous" compensation claims he's been forced to defend, says the Government needs to start tackling the issue head on.
He showed CCTV of an incident where a customer was punched in the face by a friend.
They dubbed it the 'tooth fairy case' after she later brought a compensation claim.
She said she slipped on the floor in the venue, damaged her teeth and tried to claim over €8,000 in medical expenses.
However, after watching back the CCTV footage, they realised she hadn't fallen and had gotten into a row with her friend.
She dropped the case after being informed of what the CCTV showed.
"We have 80 CCTV cameras watching everything in the venue. This girl had a medical bill for €8,500 and wanted us to pay it but we weren't going to pay when we did nothing in the wrong. Any case where we've been in the wrong, we will always try settle with the customer to avoid it going to court and racking up massive legal fees.
"We had another case involving two teachers, we dubbed that case the 'dancing queens'. It was around Christmas time and one of them fell, cracked her tooth and wanted to see the CCTV as she wanted to bring a claim. She said she fell on a slippery floor but we had evidence showing otherwise. Her friend was holding her dancing and let her go and when we showed her what actually happened, she ran out of the pub."
- Read more: 'My insurance rose to €102k as a result of claims' - The reality of trying to run a business in Ireland
Earlier this month, one of Dublin's biggest nightclubs, the Wright Venue in Swords, announced it will be closing its doors at the end of January.
Michael JF Wright Hospitality Group says its focus is on the food business and will now open Jam Park – a game, eatery and events space.
“The Wright Venue has been an incredible journey. Since taking a chance and building a venue in north Dublin in the worst of the recession, we’ve spent a decade welcoming customers in their thousands from all over the country," Michael Wright said.
The Wright Venue is just the latest in a string of nightclub closures across the country.
A former nightclub owner in Co Tipperary told how he had to close down his business because he couldn't afford the insurance costs after a string of compensation claims by customers.
The 58-year-old, who owned a club that had been in his family for 120 years, shut the club down in the summer of 2016 as it was costing him €35,000 to insure the premises each year.
The dad-of-three had been running the club for 15 years and said he had to deal with - on average - two to three claims a year, which drove up his insurance premium.
While he said some of the claims were genuine, in a few cases he believes the nightclub shouldn't have been found liable as the customers were "very intoxicated".
He is now calling for a more "level playing field" as he feels nightclub owners are being faced with a "lose-lose situation" as insurers are encouraging them to pay-out because it can "often be less expensive than fighting the case".
"I reckon that every nightclub is having the same kind of experience. I think one of the big problems is that people are not taking responsibility for their own actions. They are pre-drinking and getting hammered and we can't protect people from falling, we can only stop them coming onto the premises if they're too drunk, but even when we've tried to do that, we've been sued."
Nichola Nolan, manager with Crotty Group Insurance, said nightclub owners are finding it increasingly difficult to get insurance in Ireland.
In their experience, premiums have been increasing year-on-year and because of the unwillingness to insure, and the fact that there are fewer insurers available to nightclub owners "results in less competition which in turn results in higher premium cost".
"In my experience the majority of nightclub and entertainment venues are difficult insurance risks to place even for the most seasoned brokers and we are now finding that only London Market Insurers are willing to offer terms for liability risks for nightclubs.
"In most instances, the covers will come with high excess’s applied on each claim – sometimes up to €10,000 in my experience.
"The goal of most bars and nightclubs is to provide a gathering place (which means a high footfall) where patrons can have a good time, often by listening to or watching entertainment, and/or dancing, while purchasing and consuming alcohol. However, it is the latter item, the consumption of alcoholic beverages that tends to lessen or remove inhibitions in many people, which is a frequent cause of problems and, increasingly, claims for bar and club operators.
"This results in higher frequency of slip/ trip/falls incidents and due to the increased claims culture in Ireland a higher number of personal injury claims put through under the nightclub insurance. For example, one of the questions asked by insurers in recent years is where the toilets are located in the club, because from their statistics, up to 80pc of these claims happen while patrons are going up or down stairs where toilets are located, possibly after consuming alcohol resulting in falls."