'Our insurance costs have rocketed 700pc in space of only two years'
Founder and chief executive of online travel agency Click&Go Paul Hackett says his business is being held back by sky-rocketing rises in insurance costs.
His firm has seen its insurance costs surge by 700pc in only two years. Mr Hackett blames high levels of claims in the courts and large pay-outs for the insurance crisis.
He says the cost of his cover has gone from €49,500 two years ago to €400,000 now.
This means the business is unable to take on new staff, profits are being squeezed and he is unable to give his 60 employees a pay rise.
The Dublin-based firm is 30pc owned by Independent News & Media, publisher of the Irish Independent. It arranges holidays for 60,000 people a year.
Claims are so frequent in this market, with high award levels, that travel agencies are forced to get insurance cover from Britain. He said there was now only one insurer left, "so there is no competition".
"Insurers can quantify what the risk is going to be in the Irish market, and if a claim is made they can qualify what award a judge will make," Mr Hackett said.
The insurance cost issue meant he was unable to take on more staff to expand his business.
"Having to pay a premium of €400,000 will have a huge impact in terms of profitability. Profit margins are wafer-thin anyway in this business."
He said his company is still profitable but last year's rise in his premium had cut profits by 70pc.
Click&Go has a very good claims history, he said. Over the last five years the cost of claims is less than the current €400,000 cost of the insurance cover for the business.