Friday 18 October 2019

Insurance firms must stop buying off dodgy claimants by throwing money at them - ex High Court judge

Ex-High Court president Mr Justice Nicholas Kearns. Photo: Collins Courts
Ex-High Court president Mr Justice Nicholas Kearns. Photo: Collins Courts
Charlie Weston

Charlie Weston

INSURANCE companies have been told to stop buying off dodgy claimants by throwing money at them to avoid the cost of fighting cases in courts.

And former High Court president Nicholas Kearns has also questioned if the Law Society is doing enough to clamp down on solicitors associated with fraudulent claimants.

He said judges were becoming increasingly aware of the damage to jobs and the country’s reputation caused by exaggerated and fraudulent personal injuries claims.

Mr Kearns said public patience with the delay in reforming the insurance system has run out.

“Insurance premiums in Ireland are much too high, we have too many claims and pay far too much for minor injuries,” he said at the International Fraud Prevention conference in Dublin.

Mr Kearns headed up the Personal Injuries Commission, which found that awards for minor injuries in this country are almost five times those paid in England.

He said in his address to the anti-fraud conference the commission found that awards here are the highest in the world.

“If there are higher levels of awards than ours anywhere in the European Union we were unable to find them.”

He said it was axiomatic that higher claims costs result in higher premiums, but this was not the sole reason for high insurance costs in this country.

A tipping point has now been reached in this country with schools, leisure centres, pubs, hospitals, playgrounds for kids, and local authorities being pushed over the edge due to personal injury claims and the massive increase in premiums which insurers say is the necessary.

Mr Kearns said fraud and exaggerated claims play their part in driving up premium s and driving the carousel of claims costs.

He said insurers and lawyers must do more to tackle the issue of dodgy claims.

Insurers need to “abandon their historic policy of buying off dodgy or suspect claims by throwing ‘all- in’ settlements at claimants so as to avoid incurring the costs of fighting cases in court”.

And he said lawyers have an obligation to carry out rudimentary inquiries into the bona fides of claims who walk into their offices off the street with what appears to be a suspicious claim.

“Misconduct for a solicitor includes engaging in conduct which may bring the profession into disrepute.  An association with a fraudulent claimant or claimants is surely caught by this definition. “Could the Law Society do more to ensure these kinds of situation don’t arise?”

The former High Court president said false and exaggerated claims were a stain on out system, and were damaging the country’s reputation.

Judges did not want to see swathes of people being forced out of employment by some combination of excessive awards and swingeing insurance premiums.

Judges are increasingly mindful of the damage caused by exaggerated and fraudulent claims, but a lot  still requires to be done, Mr Kearns said.

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