Personal injury costs threaten retail viability
Retailers have hit out at the slow pace of insurance reform.
Rising personal injury awards are threatening the viability of the sector, according to Ibec’s Retail Ireland division.
Large numbers of retailers will be unable to meet the rising cost of insurance premiums unless urgent reform to the compensation system is put in place.
Retail Ireland director Thomas Burke said that it is vital for retailers that proposed amendments to the Judicial Council Bill 2017 are now agreed by Government and brought into law before the summer recess.
The group said employer and public liability insurance costs are adding an unnecessary burden and limiting the sector’s ability to grow, create jobs and deliver value and choice to consumers.
Retailers estimate that on average, for every €1 allocated to an insurance claim, a business must make €100 in sales to recoup this outlay.
Mr Burke said: “Rising insurance premiums, fraudulent and exaggerated claims and general inefficiencies in our insurance market have become a major competitiveness issue for retailers in recent years.”
He said retailers report average insurance premium rises of between 5pc and 10pc a year.
This is despite a falling number of incidents in stores due to increased investment in staff training and store layout.
“Retailers are disappointed at the pace of reform and continue to pay for that delay every day in terms of rising premiums and overly inflated claims awards.”
They want a dedicated funding stream to provide resources to allow the Gardaí to tackle what Retail Ireland said was a growing prevalence of fraudulent and exaggerated claims.
“Unless urgent reform is forthcoming, many retailers will simply be unable to meet growing insurance premiums into the future,” Mr Burke said.
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