Dozens of people have withdrawn personal injury claims at the last minute after defendants refused to settle due to suspected fraud or exaggeration.
New research carried out by Aviva Insurance shows that in the last two years, 91 claimants who brought claims against insured customers withdrew from litigation prior to a court hearing, with many doing so on the steps of the court.
The company said it has been investigating approximately 800 new suspected fraudulent injury claims since 2021, worth an estimated value of €30m.
A further 300 cases which Aviva decided to defend were listed for court hearings.
There were 91 withdrawals, 70 cases were dismissed by the courts, 53 were adjourned, while 50 people had successful claims. The cost involved in defending the cases was in the region of €2m.
Aviva said its analysis shows an increasing number of claimants will withdraw their claims once it is evident that the insurer will not settle and is prepared to challenge them in court. In many cases attempts were made by the plaintiffs and their legal representatives to settle by offering to accept reduced amounts of compensation.
Aviva said these claims are a major cost to the insurance industry, customers and to society at large.
Rob Smyth, senior fraud manager with Aviva, said: “There continues to be a cohort of individuals who are willing to fake accidents and personal injuries in the hope of receiving a generous pay-out from the courts.
“The costs of investigating and defending suspected fraudulent claims, the majority of which take a minimum of between three to five years to come before the courts, are significant.”
Mr Smyth said the 91 cases represent only a small percentage of the suspected fraudulent or exaggerated claims the company receives each year.
“Behind each one of these cases is an innocent customer who has been subjected to unnecessary stress and trauma over a protracted period as they await the outcome of the case,” he added.
“Many find the whole legal process and the prospect of having to give evidence in court to be very intimidating. We are very grateful to them for supporting us in defending claims.”
Mr Smyth said the onus cannot always be on insurers or judges to fight suspected fraudulent claims, and called for questions to be asked about how certain dubious cases are allowed to proceed through the legal process.
He called on legal and medical professionals to also “bear a responsibility”.
“The vast majority of legal and medical practitioners that we engage with have high ethical and professional standards. Unfortunately, it is the actions of a minority that raise questions which the legal community need to address to ensure that everyone plays their part in protecting society,” said Mr Smyth.
Insurance reform campaigners said they welcome every effort to combat insurance fraud, as it is a source of “great frustration” for businesses.
Peter Boland, director of the Alliance for Insurance Reform, urged other insurers to follow suit. “The reality is that many major insurers underwriting in Ireland do not have any meaningful fraud department, preferring instead to settle personal injury claims quickly, regardless of the justice of individual cases,” he said.
“They then pass the cost of such cases on to policyholders.
“It is also worth noting that there were an average of 26,063 personal injury claims per year over the last five years, and yet only 98 of these, or 0.37pc, were reported to the Garda Insurance Fraud Coordination Office last year.
“Meanwhile, there is no move from liability insurers to pass on the benefits of the huge reductions in claims and claims costs over the last few years.”
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