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Proposals to cut insurance payouts don’t go far enough, says reform group


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REDUCING the payout for minor injuries by anything less than 80pc from current levels will lack credibility, according to a leading advocate for insurance reform.

Peter Boland of the Alliance for Insurance Reform was speaking after a meeting of the country’s 166 judges was asked to approve new guidelines that are expected to lead to 50pc reduction in general damages awards for minor soft tissue injuries.

The Judicial Council’s personal injuries guidelines committee examined personal injury award levels in England, Wales and Northern Ireland and the State’s law on damages before drafting the proposals.

The guidelines are to be further considered at a meeting of the council on February 20.

Mr Boland told a virtual personal injuries claims conference organised by CMG on Friday that he was dismayed the judges appeared to be “casting aside” the work of the Personal Injuries Commission and replacing it with an analysis from Northern Ireland’s Green Book personal injury guidelines.

The Commission proposals had been signed off by the Bar, the Law Society and Insurance Ireland and its work was chaired by former High Court president Mr Justice Nicholas Kearns.

The Commission found award levels here are 4.4 times higher than in England and Wales and that when awards above €50,000 for whiplash were included, that figure rose to five times.

Mr Kearns said at the time that the Republic has “one of the most generous compensation systems in Europe”.

The Commission also found that awards here are 15 times higher than in Germany and 100pc higher than in Sweden where minor soft tissue injuries are “unlikely to qualify for compensation”.

Mr Boland said that employing the compensation model used in Northern Ireland was not appropriate here.

“To quote Lord Justice John MacDermott in the introduction to the first Green Book, ‘the level of damages in Northern Ireland is significantly higher than in England and Wales’,” he said.

“As was pointed out by Lord Lowry in Simpson v Harland & Wolff (1988) this variation is in large measure due to the fact that in Northern Ireland the assessment of damages was in the hands of juries until 1987.”

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Mr Boland said there is no comparison between personal injury regimes in Northern Ireland and the Republic.

“To quote a member who operates in both jurisdictions: ‘In the North, the system is set up to get compensation to injured people. In the South, it is set up to generate legal fees’.”

Legal fees in Northern Ireland average approximately €5,000 for minor personal injury cases. In the Republic there is no limit and average legal fees for minor injury cases amount to €15,000, Mr Boland said.

Cases are settled “quickly and efficiently” in the North while in the Republic, litigated cases take an average of 4.4 years to conclude, Mr Boland said.

He also questioned why the Judicial Council’s personal injuries guidelines committee would not take submissions or meet representative groups despite a pledge that its process would be “anchored in reality”.

“It appears in reality to have been operating in judicial isolation with no input entertained from the likes of ourselves," Mr Boland said.

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