Cedric Stephens | Hidden insurance claims backlog

The Chief Justice of Jamaica Bryan Sykes has a clear vision of how the island’s court system should work.

Justice Minister Delroy Chuck, according to the Jamaica Information Service, said in his contribution to the 2019/20 Sectoral Debate that the chief justice wants Jamaica to “have the best court system in the Caribbean in three years and one of the best in the world in six years”. World-class ranking in the performance of the judicial system is as important to Mr Sykes as it is to world-class track and field athletes Shelly-Ann Fraser-Pryce and Elaine Thompson Herah.

World-class athletes always compare and measure their performance. Metrics about the performance of Jamaica’s court system are also important to the chief justice. Minister of Justice Delroy Chuck reported to Parliament that “there has been a consistent reduction of the criminal case backlog over the past three to four years. On December 31, 2016, there was a backlog of 30,667 criminal cases in the parish courts. As at the end of fiscal year 2018/19, 12,399 (40 per cent) of these cases had been cleared.”

What is the current situation in the courts? The conclusion to the chief justice’s 125-page report about the performance of the criminal court for the second quarter of the 2021 reads:

IMPORTANT SIGNS

“The criminal division of the parish courts disposed of roughly 58 of every 100 new cases filed in the second quarter of 2021. This is an impressive improvement of 33 percentage points when compared to the corresponding period in 2020. It is a further eight percentage points higher than the disposal rate in the first quarter of 2021 and now comparable with pre-COVID-19 performance levels. An examination of the case clearance rate across the criminal division of the parish courts also shows important signs of a strong recovery.

“The overall case clearance rate in the second quarter of 2021 is 111.6 per cent, suggesting that for every 100 new cases filed 112 cases were disposed in the period. This is more than twice the clearance rates of 51.50 per cent recorded in the second quarter of 2020 and 16.72 percentage points higher than that of the first quarter of 2021. The impressive second quarter performance contributed to the lowest net case backlog rate in recorded history in Jamaica, with only 1.79 per cent of active criminal cases filed within the last 4.5 years being in a state of backlog and only 6.9 per cent of all active criminal cases being in this backlog classification.

CRIMINAL CASE

“These results not only indicate that the courts have now significantly recovered from the general downturn over the 12 months preceding the second quarter of 2021, but also importantly that these courts are now remarkably close to attaining the target set by the chief justice for a net case backlog rate of under five per cent in the court system. This target is set to be achieved by the 2024/25 fiscal year but at the current rate, this division of the parish courts will attain it well ahead of time. There is now only a small probability that a criminal case filed and presided over in the parish courts will reach a backlog classification before being disposed.”

The Gleaner reported on September 17 that the chief justice said, “by March next year, the Appellate and Supreme Courts are expected to clear their backlog of outstanding judgments”. He noted that the court system seemed to have had its most productive last year. Chief Justice Sykes disclosed that the Gun Court and the Revenue Court have achieved international standards in performance deliverables on judgments and the clearing of caseload.

The insurance industry’s claims metrics that are publicly shared, as disclosed by the Insurance Association of Jamaica, IAJ, is limited to moneys paid to claimants.

We know, for example, that in 2020, the industry’s claims payment amounted to over $60 billion. Some $23.7 billion or 39.5 per cent was for life insurance benefits. Health insurance claims amounted to $20.1 billion or 33.5 per cent. The non-life sector paid $16.4 billion or 27.3 per cent for various kinds of claims, $13.6 billion of which, 83 per cent, was for motor claims.

Even though the development and settlement of motor claims mirror the development and disposal of cases in the court system, insurers do not provide the same level of granular details about their cases as the courts publish each quarter. Why is this so? What is the size of the backlog of unsettled motor claims for the quarter ending June 30, 2021, as compared to the corresponding period last year? Are claims handled more quickly in 2021 as compared to 2020?

Is the Financial Services Commission, FSC, monitoring the performance of insurance companies in these areas on behalf of members of the public? If not, why not? Do the executives leading the IAJ and the FSC have a vision about the insurance industry that matches the vision of the country’s world-class track and field athletes and the chief justice of Jamaica?

Cedric E. Stephens provides independent information and advice about the management of risks and insurance. For free information or counsel, write to: aegis@flowja.com or business@gleanerjm.com