Moyagh Murdock: No. Compensation awarded by the IRB is similar to that awarded by the courts
The answer is no. Not for claimants, not for policyholders, not for the economy or society. The personal injuries system is at a crossroads. On one side lies a time-consuming litigation process. On the other, a faster, fairer and more cost-effective alternative: the Injuries Resolution Board (IRB). Let’s be clear: the IRB works. It delivers broadly similar compensation outcomes as litigation, but at a fraction of the cost and in a fraction of the time.
The IRB was designed to streamline claims, reduce legal overheads and deliver justice swiftly. It is an efficient and effective service for claimants. It empowers individuals to resolve their cases quickly. Using the IRB delivers results in a fraction of the time. Claimants can get their lives back on track much quicker and with much more certainty by going through the IRB route. Claims take on average two years to settle through the IRB, compared with an average of six years through costly and unnecessary litigation.
The Central Bank of Ireland’s national claims information database (NCID), established in 2019, provides policymakers with a definitive independent data source on the personal injury claims environment. In its most recent report on liability claims, published in March of this year for 2023 claims data, the NCID illustrated the significant impact of litigation, with more than 70 per cent of claims settled by litigation, representing 89 per cent of injury settlement costs.
These legal costs are ultimately borne by policyholders, businesses and consumers. They affect insurance premiums and put significant strain on small businesses and unnecessary pressure on the court services with cases that could – and should – be resolved more efficiently.
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Critics may argue that litigation offers more “control” or “fairness”. But the data tells a different story. The compensation awarded by the IRB is broadly similar to that awarded by the courts. Successive NCID reports have highlighted the effectiveness and efficiency of the IRB’s claim settlement process. Compensation levels – whether in a litigated process or settled by the IRB – are based on the same personal injuries guidelines. The guidelines were introduced by the Judicial Council in 2021. The NCID has reported previously that legal costs are well over 20 times higher in the litigation channel than in the IRB. It is concerning, therefore, that the Judicial Council has proposed a 16.7 per cent increase in the personal injuries guidelines. This could erode the progress made by the Government’s insurance reform agenda. If implemented, the recommended increase would directly impact claims costs, which are ultimately borne by consumers.
As a result of the IRB and the introduction of the personal injuries guidelines, it is easier than ever for parties to resolve a case at an early stage without litigation and unnecessary legal costs. This means less delay, less waste of resources, fewer medical and other expert reports, leading to a more efficient claims process and speedier payment of compensation to accident victims.
The current claims environment and the Government’s action plan for insurance reform have created ample opportunity for claimants, insurers and their advisers to settle cases quickly and cost effectively without going to court. For personal liability claims, it is the best route to take to have claims resolved quickly and efficiently.
The IRB has been immensely positive in its 20-year history, and it continues to evolve. With a broader mediation mandate, it is more capable than ever of delivering timely, fair and proportionate outcomes. The courts should be reserved for complex or contested cases – not routine claims that can be resolved quickly and fairly using the IRB.
Moyagh Murdock is chief executive of Insurance Ireland
Seán Guerin: Yes. Court proceedings produce the best results for victims
Insurance is a numbers game and the insurance industry is very good with numbers. It can be hard for the ordinary reader to keep up. Fortunately, the Central Bank is here to help.
To understand what has been happening in the Irish insurance market, only one number matters: what the Central Bank calls “gross insurance-related result”. This number shows how much money insurance companies make on the policies they issue, after the cost of claims (including compensation and legal costs), as a percentage of premium income.
That number tells a very simple story. In recent years, the insurance industry in Ireland has been making out like bandits.
For motor insurance, between 2009 and 2012, the gross insurance-related result was -1 per cent. Between 2017 and 2023, it was 15 per cent.
For other insurance types (employers’ liability, public liability and commercial property), between 2009 and 2014 it was 0.8 per cent. In 2022, it was 31 per cent and in 2023 it was 34 per cent.
These mind-boggling increases in the profitability of insurance underwriting in Ireland have been achieved by hoodwinking the public, the media and successive governments into believing that compensation awards or legal costs, or both, were too high.
Compensation is simply a means of providing redress to a victim of a civil, as opposed to a criminal, wrong. Because the process of obtaining redress is legally and factually complex, victims are entitled to the advice and representation of expert lawyers.
Forcing down compensation awards, while at the same time reducing the ability of victims to recover the real cost of essential legal advice and representation, is a double blow to victims. But for the insurance industry, the beating of victims will continue while profits improve.
An editorial published in this newspaper last week made three fundamental errors in reaching the conclusion that “the benefits of ... taking your case to court are at best marginal”. The first error is to ignore the Central Bank findings of boomtime insurance underwriting profit, while high premiums for consumers and businesses remain. The public policy goal of reducing insurance costs to consumers and businesses has not been achieved.
The second error is to ignore the effect on victims, who are now expected to navigate the legal and procedural difficulties of their situation without legal advice and representation, unless they pay for it out of their own pockets or their award of compensation. This is unfair.
The third error is to assume that a single bureaucratic assessment of redress is an adequate substitute for the judicial process. The IRB applies the same guidelines as in court. True, but the application of the guidelines to individual cases still requires sensitivity and understanding. It is too early to tell whether the IRB does this job as well as the courts. What is clear is that the legitimacy of any system of redress depends heavily on the opportunity for a victim to have their voice properly heard.
Last year saw the 100th anniversary of the Courts of Justice Act 1924 celebrated. A century after their establishment, the Irish people trust their courts, and independent judges, to see justice done. They also trust their lawyers, both solicitors and barristers, to advise them and speak up for them.
And the Central Bank has shown them to be right. The March 2025 Central Bank report shows that issuing proceedings in court and settling with the benefit of expert legal advice produces the best results for victims. Compared with awards by the IRB, litigating and settling produces a 60 per cent increase in compensation for pain and suffering and a 500 per cent increase in compensation for financial loss.
If you’ve been injured unlawfully, call your local solicitor and let them find you an expert barrister if necessary. Don’t let the insurance industry – or your newspaper – tell you otherwise.
Seán Guerin SC is chair the Council of the Bar of Ireland
