1. W I S H (NI) Risk Management and Insurance Wednesday 28 th March Chris Parsons BSc ACII Chartered Insurance Broker

2. Chris Parsons BSc ACII Chartered Insurance Broker 1973 – 2008 Director in Insurance Brokers McKibbin & Parsons Ltd, McGuire Insurance Brokers Ltd and Willis plc 1984 Chairman British Insurance Brokers Association (BIBA) -- N I Region 1986 – 2008 Member BIBA Communications Committee and Spokesman in Northern Ireland for BIBA 1994 – 1999 Chairman BIBA National Communications Committee 1995 – Date Expert Witness in Insurance Broker Claims

3. Employers + Public Liability Insurance What’s Insured “ The Insurers will indemnify the Insured in respect of their legal liability for (a) accidental death or accidental bodily injury or disease (b) accidental loss of or accidental damage to material property including consequential loss therefrom occuring during the currency of the policy within the territorial limits in connection with the business “ Employees,Third Parties and Products Supplied or defects

4. Types of Liabilty Claims Negligence Breach of Statutory Duty (i) specific or private law duties (ii) general or public law duties Public Nuisance Malfeasance or Non Feasance

5. Personal Injury Claims General Damages -- Pain and Suffering Special Damages -- Loss of earnings or prospects, special needs eg. transport or home adaptions etc. Psychiatric illness Nervous shock Legal Fees No win : no fee

9. Liability Claims and Premiums The Statistics Eg. -Building Contractor – 90% pdh construction Wageroll £310000 Subies £180000 T/O £1.2 m Claims :-- 3 EL Claims 2 PL Claims 2006/07 – Nil ; 2007/08 – Nil ; 2008/09 - £168750 2009/10 - £107384 ; 2010/11 – Nil : Total £276134 Average claim cost / Burning cost p.a. -- £55226 pa Expected Premium -- £78,895 but was £25000 Pdh Building Contractor with no claims -- £5000

11. 2006/7 07/8 08/9 09/10 10/11 Fatalaties 7 6 7 3 10 Major Injury 393 500 567 511 483 Riddor (3 day) 1491 2227 2131 2089 1954 Totals 1891 2733 2695 2603 2447 Fatals -10 x National Average (40% struck by vehicle) Accidents – 4 x National Average (416/100,000 Employees) NI(2006/11)- 6 fatals (4 vehicles) -2 landfill sites, 1 civic amenity,1 refuse collection and 2 recycle plants -- plus + 262 major injury + Riddor accidents HSE Statistics - Injury accidents Waste and Recycling Industry in Eng+Wales

12. N Ireland verses England + Wales The Statistics Fatalaties (2006/11) in England + Wales = 33 If NI is 2.5% of Eng+Wales then 33 x 2.5% = 0.8 This is less than 1 person – in fact there were 6 so this is 500% worse than it should be - why? The same is not true for major injuries should be 309 not 262 on pro rata basis -- so why ? The League Tables (1) Agriculture (2) Construction (3) Waste Ind

13. What can an Insurer do ? Differentiate between well run, risk averse businesses and run of the mill operations. Survey business and audit risk management controls in force (not easy as no real British Standard in practice). Apply conditions/policy warranties Eg.”when insured property has finished working and prior to being left overnight -- property is cleaned down and all combustible debris removed and placed not less than 5m from other items of Insured property.

14. AIRMIC, IRM, ALARM and ISO31000 Airmic, IRM and Alarm – Risk Management ISO 31000 – the British Standard - 2009 Definition of Risk – Guide 73 published Enterprise Risk Management (ERM) standard Risk Assessment,Description and Classification ISO 31000 – select/implement control to reduce/modify risk Feedback, monitoring and audit Early days

15. Legal Differences in NI and rest of UK Scotland is unique – separate legal system and NI no parity with England Personal Injury Awards are higher in NI by 100% -- claimant gets double Legal costs are more expensive - different CPR Rules No Part 36 or Part 20 payments system for payments “into Court” Small Claims limit in NI £3000 ; in GB £5000 (increasing shortly to £15,000) Small Claims cannot deal with motor accidents in NI High Court starts at £15,000 in NI (£50,000 in GB) so costs are more expensive Result -- Insurance Premiums are higher in NI :- Motor Car Insurance + 80% (Source – Consumer Council NI –Aug2011) PL Insurance -- up to + 50% approx EL Insurance -- up to + 50% approx

16. Judicial Studies Board Guidelines for assessment of General Damages in Personal Injury Cases Green Blue Book-NI Book-Eng Quadriplegia £330-500K £212-265K Whiplash – moderate with full recovery in 24 months To £9.5K £2.8-5.1K Loss/damage to back tooth To £2.5K £0.7-1.1K per tooth

17. Chris Parsons – RTC on 18 th April 2008 at Box Junction of Upper Crescent / University Road, Belfast BT7 INN Own damage -- Nil : Third Party Claim -- £10,621 Own Solicitors - £1475 : Third Party Solicitors - £2913 : Legal Fees - £4400 Third Party damage - £2233 : Third Party Personal Injury - £4000

18. Conclusion Summary Risk Management is the only way forward. British Standard urgently needed as yardstick. NI major injury accident statistics – appalling. Vehicle involved fatalities -- (NI 2 in 3 : Eng +Wales 2 in 5). Thorough and effective supervision required. Claims costs will escalate insurance premiums. The number of Insurers will decline. NI and rest of UK – differences in damages awarded and legal system which is more complex with different rules and protocols and therefore more expensive. March 2012