Irish Hotels Warn Government Not To Increase Insurance Costs

The Irish Hotels Federation (IHF) has urged the government not to approve a proposed 17% increase in the value of personal injury awards – a move that it noted would result in a hike in insurance costs for already-struggling hospitality businesses.

Following recommendations from the Judicial Council, the proposed increase is set to be brought before the Cabinet by the Minister for Justice this week.

“At a time when cost competitiveness should be key, there is simply no justification for approving such an enormous increase in personal injury awards,” said Michael Magner, IHF president. “Current levels of awards in Ireland are already far higher than in other countries.

“For instance, it is only a few years ago that the Personal Injuries Commission found awards here to be over three times higher than those in England.”

Magner went on to say that the disparity feeds directly into “exceptionally high” insurance premiums, which businesses throughout the sector and wider tourism industry simply cannot afford. He noted the cost of doing business is already the biggest challenge facing hotels and other hospitality businesses.

“The prospect of the government approving the proposed increase is truly baffling and threatens to undo much of the progress on insurance reform achieved by the last government,” said Magner. “Unfortunately, these reforms have yet to deliver any meaningful benefits for policyholders.

“Priority should be given to addressing the record levels of profits by insurance companies and the unjustifiable volume of cases going into expensive litigation through the courts – cases that should be resolved by the Injuries Resolution Board.”