Fighting fraudulent claims remains a key priority for Aviva.
Aviva Insurance Ireland DAC (Aviva) today announced that it paid out €274 million in claims to its general insurance customers and third-party claimants in 2023, an increase of 7.5% (€255 million) over the previous year. The company reported that it paid almost 99% of claims that were finalised during the period. The increase in claims costs was driven by a number of factors including the impact of inflation on labour and material costs.
Aviva noted the following:
- Property damage claims – payments on property damage claims increased by 22% driven by an increase in the number of incidents recorded and the impact of high inflation on both the cost of labour and materials, which was particularly evident in the first half of the year. Underinsurance continues to be a feature in home insurance claims and the company noted that only 26% of customers increased the value of their cover at renewal, despite the significant increase in rebuild costs. The cost of building has increased significantly over the last three years which means that a substantial number of people may not have adequate insurance cover if they have not reviewed and increased their cover over the period.
- On the motor claims side, while there was a 16% increase in the volume of motor damage payments, the value of payments grew by 37%. It is likely that the economic downturn is contributing to the increase in the volume of claims for motor damage as more people turn to their insurers to fund small repairs to their car rather than bear the cost themselves. Inflation in the cost and availability of vehicle parts, the shortage of skilled labour, delays in obtaining parts and the stressed second-hand car market have all contributed to the rise in overall payments made. The company also points to the increasing number of vehicles with advanced technology as a key driver of cost increases.
- The total amount spent on injury claims reduced by 8.2% on 2022. While this is a positive, the failure of more than 50% of claimants to positively engage with the Injuries Resolution Board (IRB) continues to drive claims through the courts system with resultant delays and significantly increased cost.
These figures show our ongoing commitment to support customers when things go wrong which is the core value of any insurance product. Our focus is on providing a fair and speedy resolution to our customers claims and our team of experienced professionals based in Dublin, Cork and Galway work hard to make the claim process as straightforward as possible. They are supported by a nationwide network of motor repairers and property adjusters to deliver an excellent service to our customers.
Brian O’Connor, Chief Claims Officer at Aviva
“The last year has seen some good progress on the government’s Action Plan for Insurance Reform, most notably the amendment of the 1995 Occupiers’ Liability Act to introduce some much-needed balance between an occupier’s duty of care and the personal responsibility of an entrant to the property. The recent judgement from the Supreme Court upholding the constitutionality of the Personal Injury Guidelines is especially welcome. There is a real opportunity now for all parties to engage with the process, particularly for those assessed by the IRB. Once the correct information is given to the Board in a timely manner, there is no reason why its assessment should vary significantly from that made by a judge in a court hearing since both are assessing the claim with reference to the same guidelines. Unfortunately, in more than 50% of claims currently assessed by the IRB, the outcome is rejected by the claimant and, in many of these cases, a different version of injuries is presented to the judge in an attempt to secure a higher settlement. We would ask that government act to further amend the legislation to allow the IRB’s assessment, including the details of the claim submitted to be presented to the court to ensure transparency throughout the process and consistency in the application of the guidelines. There will always be serious or more complex claims that can only be resolved in court, but these should be in a minority. Personal injury claimants are fortunate to have access to an independent professional body who can assess claims fairly and quickly. The true benefits of injury reform will not be achieved until this process becomes the primary way in which claims are settled.
A further positive development that we have seen in recent months is an increase in the number of people who have been prosecuted for insurance fraud and have received custodial sentences. We have spent many years investing significant resources in fighting suspected fraud cases and, while we have seen an increase in the number of people who withdraw their claim before the court hearing due to our refusal to settle out of court, it is only when the justice system is seen to consistently punish convicted fraudsters that a true deterrent will be in place.
Brian O’Connor, Chief Claims Officer at Aviva
“We will continue to pay all genuine claims and support government reforms and the IRB’s process. Inflation and supply chain issues continue to be a challenge, but we remain focussed on our core purpose, providing an excellent service to our customers when things go wrong,” concluded Brian O’Connor.