Several West Cork businesses now facing closure over insurance costs

April 15th, 2019 10:06 PM

By Southern Star Team

Dermot O'Sullivan, Michael O'Driscoll and Keith McInerney of the Tanyard in Skibbereen which is paying €23,000 for insurance. ( Photo: Anne Minihane)

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THERE’S a real possibility that Clonakilty Park Hotel’s adventure centre arm may have to close next month if it can’t get insurance. 

That’s according to general manager David Henry, who said it wasn’t something he said lightly, but that his broker has told him the chances of getting a quote are low. 

The centre, which employs five, and which features a 100m zip wire and climbing walls, has seen its insurance costs spiral since it opened three years ago. 

‘Our premium has gone from €19,000 in year one, to €27,000 in year two, to €32,000 last year. It’s up for renewal on May 1st but nobody wants to give us a quote, and if I don’t have insurance, it’s against corporate law to open,’ said David.

‘The hotel’s insurance has also doubled in the last year going from €65,000 to €105,000. The proposed excess on the premium has gone from €2,500 to €7,500. All our revenue is going in covering these costs,’ he said, adding that they can no longer get cover for bouncy castles at the hotel. 

‘They are dictating how we do business – the whole system is wrong.’

Activity centres nationwide are among those hardest hit by widely-reported spiraling insurance costs. 

Among them is Finbarr O’Mahony who runs the The West Cork Secret, an activity centre in Kilbrittain. 

The father-of-three young children is in the middle of an incredibly stressful few weeks in the build-up to his insurance premium renewal. 

‘If I was back again, there’s no way I’d get into this business, but it’s too late now, as I’ve invested everything I have in it,’ he said.

Last year, as first reported by The Southern Star, O’Mahony’s insurance went from a manageable €7,000, to an astronomical €25,000. 

And with the policy due for renewal in May, he’s not hopeful of getting anything cheaper. However, he says €25,000 is the absolute limit he can afford without taking out a loan, which isn’t something he’d consider. 

Even if the cost doesn’t increase, he’ll be working in May and June just to cover the cost, while takings in July and August will have to be enough to see his family through the quieter winter months. 

It’s not a good position to be in. However, Finbarr is one of many West Cork and national businesses in a similar situation, due to the increasing cost of insurance.

Curley O’Driscoll of Skibereen’s Tanyard Bar and Chasers Nightclub was paying €12,000 for insurance three years ago. 

But for the past year, it’s almost doubled – to €23,000. ‘I’ve shopped around but it doesn’t matter who the broker is, there’s only one underwriter available and that’s in the UK. I considered not opening the club at all, but it was still going to cost me €19,000 just for the bar. I used to employ 20 to 25 staff but that’s down now to 14 or 15.’

He’s been in the business for 20 years, while Finbarr opened in 2009. and they are both very pessimistic about their futures, due to the stranglehold the cost of insurance is putting them under. 

They are extremely critical of the government for their inaction and the judiciary for how claims in this country are handled. They are both fully behind a group called Alliance for Insurance Reform, set up two years and among whose primary concerns is for a garda fraud unit to be set up to tackle bogus claims.

Finbarr was among a delegation from the Alliance to meet with Minister of State at the Department of Finance, Michael Darcy, in recent weeks  to highlight their concerns. 

He feels strongly that if the political will is there, things can be done to change the way people can take claims in this country. 

‘But I didn’t get any satisfaction, and wouldn’t be holding out with much hope,’ said Finbarr. 

‘None of it makes sense. The government says we must have insurance, but then the entire insurance industry remains unregulated. We’re basket cases in the country when it comes to insurance.’

Linda Murray is the director of Alliance for Insurance Reform, who also runs an activity centre in Navan and believes reform is not happening fast enough. 

‘While Minister Darcy has said the Book of Quantum will be reduced by summer and that a judicial council will also be set up by then, there’s no timeframe for the garda fraud unit,’ said Linda.

‘Only 6% of all personal injury payouts make it to court. Insurance companies pay out because it’s easier.’

The Alliance says there’s now no other choice but to ‘think outside the box.’

Linda added: ‘The standard way of insuring is not working for us, so we’re going to look at self-insurance and group schemes where we’d go to the market as a single organisation,’ she said. 

Self-insurance she said would mean businesses could be more involved in the claims process. 

‘As it is now, there’s no transparency to claims being taken and a business might only be informed when a case is  settled – we don’t get to be a part of it.’

Independent TD Michael Collins has, on several occasions, highlighted the issue in the Dáil. ‘The government needs to act now and resolve the insurance crisis once and for all,’ he said.

Finbarr added: ‘It’s a crazy situation. I want to develop and expand my facilities, but if I don’t know what my insurance costs are, how can I?’ 



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