December 8, 2022

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Insurance Costs A Cause For Major Concern In Business – InsuranceNewsNet

DUBLIN, Ireland, April 23The Irish Small and Medium Enterprises Association issued the following news release:

In response to the publication of the Alliance for Insurance Reform’s survey on insurance, showing that the future of 42% of organisations is threatened by insurance premiums, ISME is calling for immediate government action to reform the sector urgently and adequately, and to seriously look at the behaviour of insurance companies. 90% of the respondents to the survey stated that the government is not doing enough to address the situation.

“One year after the introduction of the Judicial Guidelines (https://linkprotect.cudasvc.com/url?a=https%3a%2f%2fjudicialcouncil.ie%2fassets%2fuploads%2fdocuments%2fPersonal%2520Injuries%2520Guidelines.pdf&c=E,1,2OJmLQhLTlkUREtazkI4DrYRrRlN4tL2YYqzqbFUiLstvLBSr54kmS1g9QcuUDpAFh4J8ObOL1uLsULr-8XsgNpQMVsdqMdYZOwOKW8RACdlcw,,&typo=1) for personal injury awards, which has resulted in lower awards in the courts, rather than decreasing insurance premiums, the cost of insurance continues to rise,” said Neil McDonnell, CEO, ISME. “Public Liability and Employer Liability insurances continue to rise, and this is a cause of major concern for SMEs and for business as a whole. Insurance companies are enjoying exorbitant profits at the expense of businesses. The research showed that rises in liability insurance renewals were tracking in excess of 16%. The position is indefensible.”

“ISME has made it clear for a long time that a small reduction in awards will not suffice in tackling insurance costs. The damage to a small business is incurred not when an award is made in court or by the PIAB, but immediately follows the notification of a potential claim to an insurer,” he said.

According to ISME, if Ireland is to have a functional and affordable insurance market, it needs to radically pick up the pace of reform, specifically in the areas of amending the Occupier’s Liability Act, the Defamation Act, and in addressing legal costs. Yet there is no real tangible action in Ireland to address the situation.

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None of these issues is new, and the causal factors in our high insurance costs have been clearly identified in over a decade of reports by the EU Commission, the IMF, the OECD, and by the European Court of Human Rights.

Many of the reforms identified in the Justice Action Plan 2022 were to have been completed in 2021. We believe it is fair to ask who is benefiting from this glacial pace of reform?

It is well known the small and medium enterprise sector is the cornerstone of the economy in Ireland and by a long way the largest employer. The sector is waiting and watching for the urgent delivery of results and real reform.