Insurance cases offer ‘lottery’ awards, says Bruton

Some people are influenced to take insurance cases to court because the awards

seem like "a lottery" win, Minister for Enterprise Richard Bruton has said.

He told the Dáil his department was updating its “book of quantum” on damages awarded and hoped that once in place “it will bring greater consistency to court awards”.

That would in turn reduce the likelihood that people will go to court, or in making out-of-court settlements, they would be less likely to be “influenced by a sense that court awards can be very high and almost a lottery if one goes into it”.

Speaking during a Dáil debate on insurance costs, Mr Bruton said the Personal Insurance Assessment Board (PIAB) system was stable but people were “clearly looking at court awards”.

Circuit Court awards were also relatively stable but they appeared to be growing by 40 per cent in the High Court, he said.

They were also looking looking at changes to the PIAB legislation “which could make the system smoother and provide fewer opportunities for cases to be brought elsewhere”.

Flooding

In her maiden Dáil speech, Fianna Fáil TD

Anne Rabbitte

questioned why the “flood- weary people of east Galway” have to “now accept flooding as a recurring annual event in their lives simply by virtue of where they happen to live and the planning deficiencies of recent years”.

Householders have erected barriers since flooding in 2009 and succeeded in keeping waters out this past winter “yet are rewarded by denial of cover by insurance companies”.

AAA-PBP TD Bríd Smith said vulture capitalists running insurance companies sometimes invest money in “dodgy and precarious deals”.

“Therefore, the public is bailing out what is effectively gambling on the stock market,” she added.

Prohibited

Minister for Finance

Michael Noonan

said he was prohibited from interfering in the cost of insurance products.

“The Central Bank would only have grounds to issue directions to firms where they price and operate in a manner that would endanger the firm as a going concern and so undermine the interests of policyholders,” he said.