Mr. John Farrell:

This is a real problem area. Over the past three years, we have reported more than 500 claims to the Garda under section 19 and have reported an additional 100 this year alone. The issue is not with the cases that are not reported, the vast majority of which will not provide material assistance to the Garda. The real problem is with the ones that are reported. Of the hundreds that have been reported, there have been virtually no convictions. Gardaí are incredibly hard-working, professional and dedicated people, but there is simply not sufficient capacity in the Garda with enough dedicated resources to follow up on fraud. We are fighting fraud in AIG, with 30 employees backed up by 50 full-time investigators.

I refer to what happens when a case goes to court. Take for example the case of a businessman who burns down his premises, against whom we plead fraud in open court to defend that case on behalf of innocent policyholders, as is our obligation. We are forced to spend 21 days in the High Court, at a cost of more than €1 million. That man then simply walks away from his claim, and that €1 million has to be paid by SME customers around the country. That is why their premiums have gone up despite not having made any claims. As long as claims in this country are a free-risk endeavour, people will continue to make fraudulent claims. We need assistance in this area. There needs to be far more effective follow-up on fraudulent crimes, because they are crimes and they have a real impact.

In another case, one of our customers rear-ended a third party. The cost of the damage was €80 and no personal injuries were reported at the time of the accident. Some time after the accident we were presented with two personal injury claims, which is not unusual. The first claim that went through the court was awarded €105,000. The legal fees were €98,000, though that was subsequently adjusted to €65,000. That was only for one of the injuries. There is a very real problem with the compo culture in this country and it has to be addressed.