URGENT NEED FOR GOVERNMENT TO ADDRESS INSURANCE COSTS – BRENDAN SMITH TD

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The cost of insurance continues to be a huge burden on customers, including motorists, householders, businesses, sport clubs and charities.

One of the main recommendations of the Insurance Working Group was the establishment of a Garda insurance fraud unit.  To date, this has not happened and representative organisations concerned about the cost of insurance are very strong in their view about the need for such a unit.

I understand that some small and medium enterprises and voluntary groups are now struggling to find any insurance cover.  The Government needs to implement the other key recommendations of the Working Group and further delays are not acceptable.

Insurance Costs

  1. Deputy Brendan Smith asked the Minister for Finance when he plans to implement additional recommendations of the insurance working group; if his attention has been drawn to the concerns in many sectors about increased insurance costs; and if he will make a statement on the matter. [7243/19]

Deputy Brendan Smith

As the Minister is well aware, the cost of insurance is a huge burden on customers, be they businesses, charities or sports clubs. People continue to face insurance premiums far in excess of what is justified or fair. According to the most recent figures from the Central Statistics Office, CSO, that I have seen, while premiums decreased in 2017, they have increased considerably, by more than 30%, since 2012. It is very important that the recommendations of the independent working group are implemented as soon as possible. Some have been acted upon but many of the key recommendations have not been legislated for or the relevant regulation provided for.

I hope the Minister will be able to indicate to us that additional measures will be implemented as soon as possible.

Deputy Paschal Donohoe

I propose to take Questions Nos. 11 and 12 together.

I was listening to what the Deputy said. I will give him a brief answer. Of course I am aware of the strain to which the Deputy is referring. The problem of rising premia in respect of motor insurance in particular was the main impetus for the establishment of the cost of insurance working group, chaired by the Minister of State, Deputy D’Arcy. The working group is continuing to implement the recommendations of the 2017 report on the cost of motor insurance and those of the 2018 report on the cost of employer and public liability insurance. Both of these reports contain action plans.

The seventh update was published last November. It shows that 63 of the 78 different deadlines relate to actions which have now been completed. It is envisaged that the next quarterly progress update will be completed by the end of this month. It will concentrate on outlining the definitive position in respect of all the recommendations of the motor insurance report as the last of the deadlines within its action plan passed at the end of 2018.

With regard to the other report, the vast majority of the total of 26 actions which were due for completion have now been accomplished. I remain confident that any outstanding action points will be completed within the coming months, along with the three remaining action points whose deadlines are set for various quarters of 2019.

Deputy Brendan Smith

I thank the Minister for his reply. My understanding is that one of the key recommendations of the report was the establishment of a national claims database. Legislation to establish that database was to be enacted more than 12 months ago. What is the up-to-date position in respect of that recommendation? One other recommendation that has been brought to all of our attention, particularly by those advocacy and representative organisations concerned about the cost of insurance for motorists, businesses, householders, sporting clubs, voluntary organisations and so on, is the establishment of a Garda insurance fraud unit. Many people have made well-based proposals and arguments that give the very strong message that this would be the single most effective deterrent to fraudulent claims. There is no sign of that single Garda unit being established more than two years after the discussion on its possible effectiveness began.

Deputy Joan Burton

Is the Minister aware of the extreme distress and financial uncertainty being caused to a wide variety of businesses and ventures, particularly those involving adults or children engaging any kind of physical activity, to the point where such businesses and ventures are being destroyed? I am inundated with messages from people saying that this coming year may potentially be their last year in business. It seems this is being managed with the same degree of competence as the children’s hospital. There is now a further level of uncertainty arising from Brexit. It is widely expected that additional charges will be put on the policies of people who are moving between an EU jurisdiction and a jurisdiction with whatever status Northern Ireland will have after Brexit. The working group is working away but it is not addressing an issue that will close down significant numbers of businesses, particularly in rural locations.

Deputy Paschal Donohoe

I will respond to the three questions that have been put to me. Deputy Brendan Smith asked where we stand on the national claims information database. The legislation for this database as enacted in December. Work is now under way to get it up and running. The legal and legislative work in this regard has now been completed. The Deputy’s second question was on the dedicated Garda fraud unit. The Minister of State, Deputy D’Arcy, met the Garda Commissioner, Drew Harris, at the end of last year. The Commissioner is now considering how An Garda Síochána will respond to the report and to its recommendation that An Garda develop a specific investigative capacity in this area.

On Deputy Burton’s question about our competence in this area, I am aware of the issue that this poses for smaller businesses and consumers. Earlier on I outlined that we have honoured the majority of action steps to which we have committed. More than 71 recommended actions have now been taken. While I am not in a position to give the Deputy information about the insurance policies of small and medium-sized companies, motor insurance premiums have reduced by 22.1% since their peak in July 2016. That is not information which I am supplying, but information which the CSO released last December.