The practice of solicitors offering their services to claimants on a "no foal no fee" basis should be outlawed, a tourism chief has stated.
Mr. John Power, chief executive of the Irish Hotels Federation, (IHF) also called for an active strategy to be introduced under which gardaí could pursue the elimination of fraudulent compensation claims being taken against hoteliers and guesthouse owners.
At the IHF annual conference in Westport, Co Mayo, yesterday, Mr Power said more than 40 per cent of the cost of settling personal injuries claims go to the legal system and not to the claimants. He called on the Government to create a Personal Injuries Assessment Board to take the claims settlement procedures out of the legal system.
Insurance costs are now crippling the hotel industry, with insurance companies currently quoting renewal premiums containing increases of from 40per cent to 200 per cent as a result of international market conditions, both before and after the September 11th atrocities.
The withdrawal of a number of insurance companies from the Irish market and the level of costs associated with claims had also had an adverse impact on premiums.
"This, coupled with the fact that many hotels in Ireland have been severely affected by the collapse of the Independent Insurance Group last year, has resulted in insurance posing a major concern for the sector.
"The Government must reactivate the Insurance Compensation Fund which was set up at the time of the collapse of PMPA and apply it to settling claims against companies which had been insured with the UK-based Independent Insurance Group, which collapsed last June," he said.
Mr Power said hotels and guesthouses which take part in waste management schemes should be entitled to a local authority tax rebate.
He said that as landfill sites approach full capacity and their environmental impact becomes increasingly less acceptable, environmental responsibility and financial onus on the tourism sector is likely to grow.