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Law Society and Insurance Ireland clash over legal fee claim

Insurance Ireland published figures claiming legal fees rose by €66m to €74m from 2013 to 2015 - an increase of 12%
Insurance Ireland published figures claiming legal fees rose by €66m to €74m from 2013 to 2015 - an increase of 12%

A row has broken out between the Law Society and the body representing motor insurance companies after Insurance Ireland published figures that it said showed legal fees from claimants has risen by 12% over a three-year period.

It published the figures in response to statements by the Law Society.

President of the Law Society Stuart Gilhooly described suggestions that rising legal fees had a role in the rising cost of motor insurance as lies.

He argued the legal profession was being blamed for doing its job of getting a fair deal for clients.

However, Insurance Ireland CEO Kevin Thompson published figures that he claimed brought much-needed accuracy to the debate.

The figures showed legal fees rose by €66m to €74m from 2013 to 2015 - an increase of 12 %.

The figures were supplied to an Oireachtas working group.

The group has made 40 recommendations to bring down the cost of motor insurance.

Earlier, the Oireachtas working group recommended that insurance companies should be compelled to ask motorists to produce an NCT certificate before offering cover,

The group has been tasked with taking steps to bring down the cost of motor insurance, which has been soaring by as much as 30% this year. 

The group has made 40 recommendations and will publish a report next month.  

Minister for State Eoghan Murphy, who chairs the group, confirmed that a commission would be established to benchmark compensation awards with payouts in other countries.

  

The commission also would investigate the establishment of a panel of medical experts for use in court.  

The Cost of Insurance Working Group report recommends examining legal fees, which have been blamed for adding to personal injury awards. 

It has called for a fully functioning insurance database to allow gardaí to check insurance compliance using automatic number plate recognition. 

It also recommended an insurance database for insurance companies to detect fraud. 

The group said that insurance companies should face a penalty if they fail to report claims data and it recommended that information about claims should be made available all insurance companies.

The working group has recommended examining the discount rate used by courts to set compensation awards.

The discount rate was recently changed to take account of the lower returns paid to investors and has resulted in increased awards. 

The working group recommended maximising the Personal Injuries Assessment Board process. 

It has also called for engagement with the Society of the Irish Motor Industry to examine pricing models for vehicle repair in the event of an insurance claim. 

It has called for the examination of the frequency of the publication of the Book of Quantum, which shows the average awards paid to crash victims.

There was a ten-year gap between the publication of the most recent book this year and the previous edition.

It also proposed phasing out paper based insurance discs following the introduction of a real time database of motor insurance.