Review of the 6th Qrtly Report from the Cost of Insurance Working Group

The Cost of Insurance Working Group has issued its Sixth quarter progress update. The quarterly update reports include both the Motor sector and the EL/PL sector.

COST OF MOTOR INSURANCE

Below is an update on the progress in relation to the main recommendations from the Cost of Motor Insurance that relate to the claims process in Ireland:

Recommendation 11: “Establish a National Claims Information Database."

Update: The Central Bank (National Claims Information Database ) Bill 2018 was formally published on the 10th of July last. It is hoped that legislation will be enacted by second half of the year.

Recommendation 12: “Quarterly publication of key aggregated metrics on claims costs and trends within the market."

Update: Third report due to be published in the autumn.

Recommendation 13: “Consider the feasibility of a longer-term claim-by-claim register."

Update: Public consultation took place and closed at the end of June 18. Report due by the end of Q3 of 2018.

Recommendation 14: “Establish a Personal Injuries Commission (PIC)."

Update: Second and final report has been completed and submitted to the relevant Ministers on the 12th of July 2018. Publication of the report is awaited and this is expected to occur in September 2018.

Recommendation 15: “Assess, within the current review of PIAB legislation, cases of non-cooperation such as non-attendance at medicals and refusal to provide details of special damages."

Update:  The Personal Injuries Assessment Board (Amendment) (No.2) Bill was published on the 13th of August 2018.

Recommendation 16: “Ascertain and set out the measures necessary to implement Pre-Action Protocols (PAPs) for personal injury cases."

Update: Draft regulations for PAPs in medical negligence cases to be sent for signing by the Minister in Q3 2018, as opposed to Q3 as previously stated due to legal advice being sought. PAPs in injury cases have had the draft heads of the Bill published in Q2 2018. Issues appear to have arisen and are presently being considered further. 

Recommendation 17: “Fully assess viable options for referring rejected PIAB assessments to judicial process on appeal basis so that facts established in the PIAB process are not required to be re-established."

Update: As mentioned previously, it is felt that this recommendation will be dealt with by the recommendations within 15 and 16.

Recommendation 18: “Explore with the judiciary how future reviews of the Book of Quantum/Guidelines might involve appropriate judicial involvement in its compilation or adoption"

Update: Engagement ongoing and awaiting PIC report on benchmarking of awards.

Recommendation 19: “Examine the frequency of future Book of Quantum updates in terms of any future changes to its production."

Update: To be dealt with within recommendation 15.

Recommendation 20: “Introduce more granularity into the Book of Quantum."

Update: Awaiting the outcome/views of the PIC in their future report, which is expected Q2 2018.

Recommendation 21: “Implement the Review of the Framework for Motor Insurance Compensation in Ireland recommendations."

Update:  The Insurance (Amendment) Bill 2018 was signed into law in July 2018. Within this bill it clarifies the role of the ICF and to provide a legal basis for full compensation of Setanta third party claimants.

Recommendation 22: “Examine the impact of legal and other fees on personal injury awards."

Update: To obtain a reliable set of data, the Group is still awaiting the setting up of the new Office of Legal Costs Adjudicators (OLCA) which is expected later this year.

Recommendation 23: “Review the impact of the changes to the court jurisdictional limits as they evolve."

Update: The Court Service provided it’s first report in mid-July 2018 to the group. This report is to be considered at the group’s next meeting in September 2018.

Recommendation 24: “Examine the setting of the Discount Rate (in personal injury lump sum awards), without prejudice to the outcome of relevant proceedings, and to be reviewed at regular intervals."

Update: Under consideration by the Working Group in conjunction with the Department of Finance. To be considered further in the autumn.

Recommendation 25: “Establish a fully functioning integrated insurance fraud database for industry to detect patterns of fraud."

Update: Data Protection issues have arisen and Insurance Ireland have undertaken a Data Protection Impact Assessment. The future of a fraud database will be dependent on the outcome of this assessment.

Recommendation 26: “Explore the potential for further cooperation between the insurance sector and An Garda Síochána in relation to insurance fraud investigation. "

Update: Insurance Ireland’s cost/benefit analysis was provided to the Department of Justice and Equality (DJE) in July 2018. It recommended that the Industry fund a Garda Insurance Fraud Unit. An Garda Siochana’s response to such proposal is awaited.

Recommendation 27: “Review of Section 30 of the Civil Liability and Courts Act 2004."

Update: Court Service continue to examine the requirements to enable commencement of Section 30. Data Protection, technical and resource considerations continue to be assessed.

COST OF EMPLOYERS AND PUBLIC LIABILITY INSURANCE

I detail below the progress in relation to the main recommendations from the Cost of Employers and Public Liability Insurance that relate to the claims process in Ireland:

Recommendation 1: “CSO to consider feasibility of collecting price information on the cost of insurance to business."

Update: CSO’s work on going. Report due back by the end of 2018.

Recommendation 2: “Central Bank to examine merits and feasibility of collecting Employer and Public Liability Insurance claims data in the Nation Claims Information Database (NCID)."

Update: Consideration to extend to EL and PL once Motor database is up and running.

Recommendation 3: “Courts Service to publish the results of personal injury cases in a more granular way in its annual fashion."

Update: Under consideration by the Court Services at present.

Recommendation 4: “Department of Finance to publish a key information report on Employers and Public Liability Insurance Claims."

Update: Template issued to Insurance Ireland for the data to be submitted by the end of Q3 to allow sufficient time for production and publication of a report by the end of Q4.

Recommendation 5: “Law Reform Commission to be requested to undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap damages."

Update: The subject of capping damages was included in the 5th Programme of Law Reform. It is proceeding through the various stages of the Cabinet then the Oireachtas Joint Committee, when the report will then be published.

Recommendation 6: “Amend the wording of Section 8 of the Civil Liability and Courts Act 2004 to ensure defendants are notified of a claim having been lodged against their policy."

Update: Further consideration being given as to the best legislative vehicle that can be availed of to achieve this recommendation.

Recommendation 7: “Relevant Court Rules Committee(s) to o consider amendment of The Rules of Court in respect of Section 8 of the Civil Liability and Courts Act 2004."

Update: Courts Service has arranged for this recommendation to be placed on the agenda of each Rules Committee for consideration.

Recommendation 8: “Ensure greater general awareness of notification obligations under Section 8 of the Civil Liability and Courts Act 2004."

Update: Department of Finance and the Department of Justice and Equality has written to the various agencies and societies to promote the general awareness of the obligations under Section 8.

Recommendation 9: “Review of the operation of the six-month standstill period provided for under Section 50 of the Personal Injuries Assessment Board Act 2003."

Update:  (Unchanged) PIAB have written to the main insurance companies and, once responses have been received, a report will be provided to the Department.

Recommendation 10: “Insurance Ireland and business organisations to agree a set of guidelines in respect of notifying and engaging with policyholders regarding claims submitted against them."

Update: (Unchanged) Insurance Ireland believe the CPC requirements address all of the concerns in respect of this recommendation. Options are being considered to bring forward recommendations, given the industry’s diverging opinion.

Recommendation 11: “An Garda Síochána to commence producing statistics on complaints and investigations relating to fraud within the personal injuries area."

Update: An Garda Síochána set up a specific fraud category on their Pulse system, which went live in July 2018. Training to take place within the force and over time this will provide reliable data.

Recommendation 12: “The Courts Service to commence producing statistics on prosecutions and convictions relating to fraud within the personal injuries area."

Update: Due to the face that the An Garda Siochana pulse system will capture data regarding fraud, it was agreed that such reporting should come from their systems rather than the Courts Services.

Recommendation 13: “Insurance Ireland, An Garda Síochána and the DPP to agree a set of guidelines in respect of the reporting of suspected fraudulent insurance claims."

Update: Guidelines agreed upon in June 2018 and expected to become operation in September 2018. A Roundtable forum has established and will continue meeting to address concerns as they arise.

Recommendation 14: “Amendment of Section 14 of the Civil Liability and Courts Act 2004 to improve the use and effectiveness of the provision."

Update: Consideration being given as to the best legislative vehicle to be availed of to achieve the desired goal of this recommendation.

Recommendation 15: “Department of Justice and Equality to consider proposing an amendment to the Judicial Council Bill to facilitate training and information supports."

Update: It is to be brought to the attention of the judiciary that consideration be given to training.

Conclusion

As mentioned in my previous reports, the main recommendations that effect the claims environment are 14, 15, 22 (Motor Report) and 4, 5 (EL/PL Report).

Whilst it is reported that 82% (up from 80%) of the recommendations have been completed at this stage, the main recommendations that will have an effect on the cost of insurance in Ireland remain outstanding.

The next main step will be the second and final report of the Personal Injuries Commission, which has been submitted to the relevant Ministers. It is due to be made public in late September. It will be interesting to see whether this ends up as another list of recommendations and their time line. Snippets have leaked into the media, who state hard hitting recommendations have been put forward, but at present this is purely speculation until the report is made public.

I enclose a link to the full report Click Here

Michael Whelan

Head of Claims

DRM Claims Services

September 2018