There is now “no excuse” for insurance companies not to reduce their premiums, a leading expert has said. 

Yesterday, the Supreme Court dismissed a challenge by a plaintiff who argued the guidelines pertaining to personal injuries introduced in 2021 amounted to an unconstitutional encroachment on judicial independence. 

Speaking to Newstalk Breakfast, Alliance for Insurance Reform CEO Brian Hanley explained why the guidelines are designed to push down the cost of premiums. 

“The new guidelines that came in provided much greater specificity in terms of the injuries and the awards, providing for greater consistency in awards,” he said. 

“It also provided [that while] ensuring people are appropriately compensated, it had the desirable effect of reducing awards and personal injury cases, bringing them more into line with those awarded in other countries. 

“In fact, the guidelines have seen a reduction in the size of awards of some 41% at the Injuries Resolution Board where cases were settled there.” 

The Four Courts, where the Supreme Court sits.

Mr Hanley said the guidelines are a “key pillar” of the Government’s drive to bring down insurance costs and the Supreme Court’s decision should provide a “more predictable and consistent approach”. 

“I think we should start seeing the benefit of yesterday’s decision immediately,” he said. 

“There’s really no excuse now for insurers not to start passing on the savings; for example, any additional financial provisions that might be made in case the guidelines were found to be unconstitutional no longer exist. 

“As well as any future savings the guidelines will create from the reduced awards, bringing them more into line with other countries.” 

Impact

For some time, various companies had complained the high cost of insurance was impacting their ability to operate. 

Mr Hanley said the ruling should help those who have been struggling to pay their insurance bills. 

“I think it’s important that they [the benefits of reduced costs are] shared across society,” he said. 

“From business, to sports, arts, community and voluntary groups that really can’t afford to wait any longer.”

Last week, Minister of State for Trade Promotion, Digital and Company Regulation Dara Calleary promised that people will see insurance premiums fall “from this year on”.

Main image: An insurance invoice.