Mr. Éamonn R. Downey:

Gabhaimid buíochas ó chroí leis an choiste agus leis an Chathaoirleach as an deis a thabhairt don ghrúpa labhairt inniu. I thank the Chairman and distinguished members of the committee for meeting us and I also thank the clerks to the committee, Mr. Eugene Ó Cruadhlaoich and Ms Caitríona Dunne, for their professionalism and courtesy in getting us to this stage. We are amateurs in this forum.

My friend Mr. Brendan Dempsey has appeared before the committee previously. Mr. Dempsey is a stalwart of the Society of Saint Vincent de Paul, SVP, in Cork and when he was in charge locally we read his strong comments to the newspapers regarding the way in which people were being treated by insurance companies. We subsequently made contact with him and have been working with him and other members of SVP over the last three years. When I say "we" I refer to my own company, Owens McCarthy Limited, which is a firm of insurance claims specialists, also referred to as public loss assessors, and not to be confused with the insurance loss adjusters who are paid by and represent the interests of insurance companies.

Many of the claims specialists in Ireland got together over the last two years to form the Irish Claims Consultants Association with the aim of setting high professional standards for our members, regulating the profession and, in the future, offering formal education and examination. John O’Donoghue is the managing director of Owens McCarthy and was involved with many of the cases in which we were able to assist clients of SVP. Separately, Mr. Paul Kavanagh, managing director of McCarthy Insurance Group has assisted SVP on related insurance problems and we all now work in the same group with SVP which, I hope, explains why we are here together. Mr. Kavanagh has real knowledge of the marketplace in terms of obtaining flood cover for homeowners, the attitude of insurance companies and related aspects and will speak after me. Mr. Dempsey can provide examples of the difficulties being faced by homeowners, many of whom face life challenges not confined to flooding and insurance. My area is claims handling. I commenced my training in 1978 and spent 25 as a loss adjuster before I changed sides and began loss assessing in 2003.

I appreciate the role of this committee and its brief but when I watched its meeting with the Irish National Flood Forum I was heartened by the honest comments of both Mr. Dempsey of SVP and Ms Seosaimhín Ní Bheaglaoich of the Dodder Flood Group. No reasonable person could fail to be impressed by the passionate and honest way in which they described their experience of dealing with insurance claims. I believe I can assist this committee in better understanding homeowners' experiences of insurance claims and the manner in which they are treated by their insurers. While some of the bad practices are down to a small number of individuals, the remainder tend to follow suit. I would welcome the opportunity to expand on any of the following points, which arise from the Cork floods in 2012 and from our general experience in these matters. Insurers have not given a true commitment to fairly advise homeowners when they notify a claim of their right to retain their own representative. The spirit of the consumer protection code is ignored on a daily basis. Insurance companies retain part of agreed claims settlements incorrectly and contrary to their practices outside of Ireland. Many of them are headquartered outside of Ireland and they behave differently abroad. This is known as "retentions" within the insurance industry.

Companies also encourage an adversarial and combative approach in their investigation and handling of claims. This is deliberate and particularly common where a householder employs his or her own assessor. The next point I will make is more nuanced now than when it originally arose. Insurance companies used their builders' price as a measure of indemnity or how much should be paid. They have the fall back position that their builders are available to carry out repairs for this price. However, the agreed rates are not representative of the construction market and they give rise to an issue that should concern the committee, namely, builders operating in the black market. Through a myriad of actions, insurance companies appear to want to foster an atmosphere in which the repairs are carried out by VAT unregistered contractors, hence saving them money. This is the most pronounced effect of the retentions issue. They attempt to use builders from panels they have set up, thereby removing the right of choice and attempting to use a scope of works that does not represent the damage caused. Variants of this scheme include the ridiculous situation of insurers insisting on using unrealistic prices they refer to as agreed rates for repair work. Sadly for me as a former loss adjuster, they force these practices on loss adjusters, the majority of whom are professional men and women. The whistleblower legislation cannot be introduced quickly enough for us. I pray for the emergence of individuals who will reveal the inside stories of what insurance companies do.

I cannot get my head around the similarity of certain practices or how some insurance brokers are influenced - I use that word cautiously - not to advise customers of the need for independent advice. The amount of claims and the amounts of settlement are usually a distance apart. Members may recall the story Mr. Dempsey told about the small builder who was flooded. The builder claimed €180,000 and settled for €80,000 because that was the amount he needed and he knew the game. Insurance companies ask for a premium for a risk, whether on motor insurance or whatever, knowing that they are unlikely to get this sum. Negotiating over a deal is a practice from time immemorial but when I submit a complete and full claim, perhaps with some trimmings for negotiation, they faint with shock. They do not suggest fraud because the law of the land is clear on this and they know I would have them in the High Court fairly quickly. However, they advertise constantly to warn people about fraudulent or exaggerated claims. Ordinary decent people are made nervous by this type of advertising and many will not submit claims because of the fear of being associated with something that is wrong. Irish society cannot encourage false or fraudulent behaviour in any part of our lives and this responsibility applies to insurance companies also.

I cannot conclude my contribution without commenting on the Central Bank of Ireland, which has direct responsibility for insurance companies. In our dealings with the bank, both as individual firms of assessors and as a young representative body, we have experienced only courtesy and professionalism. It has a heavy schedule of responsibilities and it is dealing with large commercial organisations with vast sums of money and vast experience of protecting their position.