Insurance industry “Compo Culture” Spin is the dodgiest claim of all

Summary of an article published on Friday 6th December 2019 in The Irish Times – written by Mark Paul

This Article, recently published in the Irish Times, is very interesting and it reflects the views and, indeed, the experience of many Solicitors in the country and, in effect, what the article is saying is that the narrative at the “Compo Culture” that has caused a recent surge in insurance premiums is, in fact, a ball of smoke fueled by prejudice and innuendo.

The article makes a very reasonable argument, based on the statistical facts that the number of claims is not increasing:

“It is simply not true that a growing number of grubby chancers on the make is the cause of the steep spike in premiums in recent years, putting innocent SMEs out of business.  Virtually every reliable statistic shows that to be rubbish.”

The article points to the official data on the Courts’ service which shows that, in the District Court where claims can be made up to €15,000.00 the number of claims made in that Court was down 2.4% in 2018 and, in the Circuit Court handling claims up to €60,000.00 and where most personal injury claims proceed, the number of claims was down by 4.3% and, in the High Court for cases in which damages claimed are in excess of €60,000.00, the numbers were statistically flat.  

In addition, the article points to the fact that the insurance industry keeps referring to the number of fraudulent claims that are brought, but as Pierce Doherty TD established at a recent Oireachtas Committee meeting if insurance companies were identifying fraudulent claims at the rates at which some suggest, up to 20%, then there are at least 5,000 fraudulent claims in Court every year and, yet, only a handful of cases are ever reported as suspected fraud.

Mark Paul makes the argument in the article that, even the word “compo” in the way that it is used and pronounced, is intended the mock to be evocative of pulling a stroke.  He goes on to summarise that:

“Insurance Companies have sold us a pup in compo culture.  Litigation is adversarial. Genuine claimants are not morally obliged to be restrained or thrifty.  They are engaged in legal battle…

Hussey Fraser
December 2019