There could be some positive news at last for stressed businesses in the leisure and activity sector being pushed to the brink by rocketing insurance premiums after it was announced that the Cabinet had this morning approved amendments to the Judicial Council Bill - currently going through the Oireachtas - to establish a Personal Injuries Guidelines Committee.
According to Meath East TD and Minister for Employment Affairs and Social Protection, Regina Doherty today informed the Meath Chronicle that this will provide the quickest possible means to address an issue which has become a major challenge to many businesses.
“This Committee will set guidelines for appropriate damages for various types of injury and hopefully will lead to a fairer re-calibration of personal injuries pay-outs. When you consider, for example, that Irish insurers pay four times as much for soft tissue injuries as their counterparts in the UK, then something is not right.
"The establishment of a Guidelines Committee and a fairer system of insurance compensation will lessen the financial burden which is currently affecting so many businesses in County Meath and throughout the country.”
Niall O'Driscoll is the managing director of O'Driscoll O'Neill Insurance, a broker that works with clients in the leisure industry. He says that there are a number of complex issues surrounding the current insurance crisis.
"This sector of the industry is experiencing a lot of problems. The amount of claims happening recently has been quite high resulting in insurers losing money and increased premiums for businesses.
"We have a culture where if someone gets whiplash in Ireland they want €25,000 whereas in England you get €2,000. The claims culture has exploded.
Irish insurance companies have been reluctant to provide cover forcing businesses to look to the UK according to Mr O' Driscoll.
"It purely boils down to where insurance companies choose to put their investment and capital, would you put your money into a bank that's losing money?
"They are putting it into things like home insurance where the losses are more predictable and measured.
Mr O'Driscoll comments that the cost associated around claims is another problem,
" If there is a €100,000 award, the chances are your legal costs are €60,000. The timeline of settlements is another problem in Ireland that is why very few companies are coming into Ireland.
"It takes five to six years for a claim to wash out here so they have to keep their liabilities tied up for a lot longer whereas in the UK it takes two years.
It's not just in the leisure sector experiencing these difficulties as he explains,
"There are other sectors having similar issues like the sports industry, entertainment, festivals and community centres, anywhere where there is a high footfall.
"Tackling fraud in claims is a huge issue. If the Irish culture wants those sorts of awards, businesses will have to continue to pay high premiums."
Numerous businesses across Meath have been feeling the pressure of spiralling insurance claims with Rathbeggan Lakes - a 22-acre family adventure park near Dunshaughlin - announcing that it would not be re-open after this summer season, while kayaking and canoeing company Boyne Valley Activities will consider its future after teh summer after securing an insurance premium some 400 per cent higher than when the business started six years ago.
Navan business woman Linda Murray who operates Huckleberry's Den play centre appeared before an Oireachtas Finance Ctte in April to inform TDs that her business and many like hers were in immediate danger of closure because of the difficulty securing and paying for exorbitant insurance costs. She said that 61 play centres had been facing closure as no insurer was willing to offer them a premium in Ireland. She blamed the high level of payouts and the prevalence of bogus claims for the sector’s difficulties.
However Linda grouped together with similarly affected businesses under umbrella orgainsation Play Activity and Leisure Ireland (PALI), and through an insurance broker managed to convince a UK provider to write policies for all of them.