Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

I will ask a number of questions together because I am conscious that many other members wish to contribute. I hear what Mr. Monks is saying and I agree with him on some of the exaggerated awards that are being paid. While that issue needs to be addressed, I do not believe the insurance sector will reduce premiums accordingly. I do not trust the industry in which I believe a cartel is operating. Ms Murray's example of €5 million in premiums and €1 million in reserves shows that price gouging is taking place.

In his opening statement, Mr. Boland spoke about the commitment by insurers to reduce prices in parallel with reforms. FBD told the agricultural sector that prices would fall if it undertook additional safety measures, installed cameras and so forth. Rather than falling, insurance premiums have increased dramatically resulting in the closure of some rural marts, which constitute the fabric of many rural communities. Before any further reforms are undertaken at this level, do we need a commitment from insurers, similar to the one given in 2002, that if businesses take certain steps, insurance premiums will reduce by a certain percentage? This was set out in a table agreed at that point in time.

There has been much talk about fraudulent claims. The insurance industry told us these claims result in a €50 increase in all motor insurance premiums. We can imagine that the cost is significant and not just in motor insurance but in other areas of insurance. Many people do not claim from their insurance even when the claim is legitimate. I think the model is broken. If a tree fell on my car - one fell across the road from my house and my car ran into it just a couple of weeks ago - there is no chance that I would claim on my insurance policy because the company would increase my premium by twice the amount that it would cost to fix the car. Many people who have minor accidents simply do not contact their insurance companies. The sector is broken because businesses are penalised for claiming and using the insurance they have.

We have statistics on fraudulent claims for the first time. Insurance companies now have to report fraudulent claims or suspected fraudulent claims to the Garda. I found it quite surprising that from 1 October to the end of February, which is five full months, there were only 19 cases of fraudulent claims right across the insurance sector. That includes public liability insurance, motor insurance and all the rest. Either the insurance companies are not reporting what they are saying or they are exaggerating the number of fraudulent claims to justify the price gouging that is taking place, or there is something else going on. That does not take away from the point that there needs to be a Garda insurance fraud unit. We are very strongly in favour of that. The committee is united on it. It should happen without delay. Is insurance fraud as considerable as the insurance companies are telling us? If so, why are they reporting only three cases per month across all sectors of insurance? The claims that are reported are suspected fraudulent claims. Some of them may not be.