The clamour for reduced insurance premiums has grown louder after the Supreme Court’s rejection of what was effectively a test challenge to guidelines slashing personal injury awards.
In operation since April 2021 following their approval by a majority of the Judicial Council, the guidelines have resulted in lower awards from the Personal Injuries Assessment Board, (now the Insurance Resolution Board), more settlements of cases and a sharp drop in personal injuries litigation before the High Court, where legal costs are highest.
More cases are now being taken to the Circuit Court, where costs are lower. Sources estimate about three in four cases are now being dealt with under the guidelines, which provide for considerably lower awards for minor injuries than under earlier guidelines, known as the book of quantum.
The significance of the outcome of the personal injuries case taken by Bridget Delaney was evident from the number of lawyers who crowded into the Supreme Court on Tuesday as the seven judges delivered their judgments.
The majority court’s decision that, thanks to separate “saving” legislation enacted in late April 2021, the guidelines made under the Judicial Council Act 2019 have legal effect has clarified their status. The outcome of the Delaney case has adverse implications for at least 10 other cases challenging aspects of the guidelines which had been put on hold pending the Supreme Court decision.
While that decision was met with dismay by some personal injuries lawyers, others were pragmatic, saying it had provided much-needed clarification for all involved in claims.
Several sources said it is better for both litigants and lawyers that claims should be decided under guidelines made by judges who have experience of personal injuries litigation, rather than by the Oireachtas or officials of Government departments.
Solicitor and senior counsel Stuart Gilhooly, the Law Society’s representative on the personal injuries commission which recommended the introduction of guidelines, said he welcomed the certainty provided.
A review of the guidelines has been undertaken, as required under the Judicial Council Act, by the personal injuries guidelines committee of the council, he noted.
The committee’s report, now with the council’s board, is expected to result in some proposed amendments to the guidelines being put before the council later this year. In line with the Supreme Court judgment, any such amendments would require legislative intervention.
[ Insurers face pressure to cut premiums as court removes injury awards uncertaintyOpens in new window ]
Gilhooly said he hopes there will be amendments to the award levels in the guidelines to reflect cost-of-living and inflationary increases since April 2021. He is among many who are sceptical over whether the guidelines will result in reductions in insurance premiums, as the Government seeks under its insurance reform plan. He stressed the onus in this respect is on the industry.
“This removes the last remaining excuse for the insurance industry for not reducing premiums – it’s time for the insurers to put up or shut up,” he said.
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