A newly emerging 'compensation culture' is driving up motor insurance premiums, an Irish Independent investigation has found.
A review of a number of court cases also shows a rise in the level of awards being made by judges and legal costs that end up being double what insurers had been expecting.
There has been a surge in compensation claims for accidents, due to more economic activity and a reawakening of the 'claims culture'.
Whiplash injuries now account for 33pc of all the money spent by insurers on claims, according to Insurance Ireland, which represents the industry.
A person with a soft-tissue whiplash injury can expect a payout of up to €15,000, making Irish necks the most expensive in the EU.
This is four times higher than in the UK, while in Germany no compensation would be paid for this type of injury, other than rehabilitation costs.
An study of lawsuits by the Irish Independent has revealed surging inflation in the level of compensation awards.
Some of the cases include:
Awards being made despite evidence of people being capable of work after claiming that they could not function due to an injury;
Compensation being awarded even though courts are presented with evidence that the injuries already existed before the accident;
Award levels ending up being double what was paid previously in similar cases;
Legal costs turning out to be four times what it had cost in past to hear the same sort of case;
Awards being made despite evidence that the injuries were exaggerated.
Motor-insurance premiums have jumped by 20pc in the past year. Irish-owned FDB alone experienced a 27pc rise in claims costs last year.
Lawyers deny that higher awards and elevated legal costs are leading to higher premiums.
But the chairman of the claims committee of Insurance Ireland, Allan Archer, said higher awards, rising legal costs and fraudulent claims were pushing up premiums for drivers.
"The significant and continued increase in motor premiums is driven by the cost of claims in Ireland," he said.
He was backed up by AA Ireland's Conor Faughnan, who said there was evidence of much higher court awards now being made in injuries cases.
People can take a court case if they first reject an Injuries Board award.
When courts make higher awards, it impacts on all open claims that are of a similar nature and not just the individual claim.
The judgments create a new precedent and insurers then have to put aside more reserves in order to meet future awards.
This, in turn, is pushing up insurance premiums.
Chief executive of the Consumers Association, Dermott Jewell, called on the Government to probe the insurance and claims area.
"We urgently require an independent and anonymised review of all relevant data in terms of cost of claims and any and all associated charges and provisions," he said.
The Law Society, which represents solicitors, has rejected claims that its members and court awards are encouraging a claims culture.
Director Ken Murphy said: "Lame suggestions that lawyers can bear any responsibility for increased premiums have absolutely no basis in reality."
A spokesman for the Injuries Board said it was seeing a 7pc rise in the number of claims.
Whiplash injuries make up the majority of claims made by people to insurance companies.
Some 80pc of claims are for the soft tissue injury which is notoriously difficult to disprove.
The Injuries Board provide guidance in terms of what compensation you could expect. The following are figures from its 'Book of Quantum':
Up to €14,400 - Minor whiplash neck injury - good recovery within 12 months
€11,500 to €17,400 - Moderate whiplash injury. Substantially recovered within 24 months
€15,900 to €64,500 - Significant ongoing whiplash injury
€59,400 to €78,400 - Severe neck whiplash injury (serious and permanent condition).
A broken leg can generate a payout here of €35,000 but a similar fracture will be compensated with €15,000 in Britain, according to insurers.
The Irish Independent has found cases where large pay-outs were made by courts, despite substantial evidence that claimants had grossly exaggerated the extent of their injuries. However for legal reasons we are prohibited for printing exact details.