IHF survey: insurance costs “significant -ve impact”
Of these, the average increase in premium was 15% – this in addition to substantial increases in recent years.
“The time for foot-dragging is long past,” said IHF Chief Executive Tim Fenn in calling for urgent action by the Government to address escalating insurance costs which have now reached an unsustainable level, averaging €1,150 per guest bedroom annually.
With 75% of hotels saying that excessive insurance costs are having a significant negative impact on their business Tim Fenn believes that the Government must now deliver concrete results in relation to insurance reform.
“Progress has been extremely slow to date and this inaction is having serious consequences for the viability of hotels and other tourism businesses,” he stated, “The exorbitant levels of awards and lack of consistency is also making Ireland less attractive for insurers and we’re seeing an increasing number that are no longer willing to provide cover to hospitality businesses. This in turn is reducing competition in the insurance market and driving up costs.
“With levels of awards now running at up to five times those in the UK, it’s particularly frustrating that we still do not have a firm timeline for legislation setting up a judicial council to review levels of awards made by the courts. This has effectively stalled and is very worrying given the detrimental impact escalating insurance premiums are having on our competitiveness which is ultimately borne by the consumer.”
While welcoming proposals by the Government for the setting up of an interim committee to look at personal injury claims, the IHF Chief Executive added, “This is very much a stop-gap measure. There remains a lack of clarity around how soon such a committee would produce revised guidelines on levels of compensation which are currently severely out of kilter with other countries.
“Levels of fraudulent and exaggerated injury claims are another major concern for our sector and one where there’s been an inexcusable lack of progress. We’re calling for a ‘zero-tolerance’ approach to fraud and for urgent priority to be given to establishing a dedicated resource within the Garda Síochána specifically tasked to investigate fraudulent cases. This should go hand-in-hand with the referral of fraudulent claimants for prosecution.
“This is an area where insurers, the legal system, Garda Síochána and Government have a vital role to play.”