Bríd Smith (Dublin South Central, People Before Profit Alliance) | Oireachtas source

To add to what has been said, everybody is pretty concerned about this. The Beatles sang a song about the taxman, whose lyrics stated: "If you drive a car, I'll tax the street ... If you take a walk, I'll tax your feet." The same could be said of the insurance industry today. Everything is subject to insurance, from people's homes to their cars, their bikes, their pets, and every part of their health.

Insurance costs have risen dramatically, particularly over the last three or four years. The cost of insuring my van increased by 40% recently. Everybody is suffering as a result of the increase in premiums, but it is particularly punitive for younger people. Some examples have been given, and I would like to refer to a young woman who ran as a candidate for us in Carlow. The cost of insuring her car rose by €2,000.

Insurance costs are punitive and discriminatory towards younger people and those who cannot afford new cars. The system requires an NCT test for cars that are more than ten years old, but at that stage insurance companies impose punitive measures, which increase the cost of insurance. Why this is happening has already been discussed.

We need to examine the issue, but no proper data are available to us. If we in the House are supposed to be regulators and legislators, the absence of clear data makes that almost impossible. A report by Dorothea Dowling, the chairperson of the MIAB, stated:

We are being told premiums are going up because awards are going up but the argument is not supported by published records of compensation awards. In fact there is a €1 billion difference between premium income and published awards.

We know from the Central Bank that the income of the ten companies that underwrite motor liability insurance is €1.4 billion a year. Records show that, collectively, awards in the courts totalled €1.69 billion and awards by the PIAB totalled €166 million. As she said, there is a difference of €1 billion. There are inconsistencies in the claims of the insurance industry. The industry also tells us that we are paying for the losses of Setanta Insurance, which is true. Its €90 million losses are being loaded onto the public.

I want to make a more general point about the absence of regulation in the insurance sector. What has happened has been referred to as a boom-and-bust scenario, but it is actually an aspect of finance. That is how it is dealt with by the markets. Therefore, it is subject to all the nuances and ups and downs of the capitalist market.

That goes to the nub of the problem. Insurance which is required on a person's home, car and life - on the crucial aspects of living - is subject to the good and bad of the financial market and how it performs internationally. Vulture capitalists who run these companies will sometimes invest money in dodgy and precarious deals. They will invest money and lose money, and they will try to make returns on their investment with the money we pay in our insurance. Therefore, the public is bailing out what is effectively gambling on the stock market.

There is another aspect of regulation which seems to have been a concern of the Department of Finance to a degree. The Central Bank deputy governor, Cyril Roux, wrote to Aidan Carrigan, assistant secretary of the Department of Finance, in a letter that was released under freedom of information. When Mr. Carrigan expressed concern that competition in the sector was not viable and prices were going up, and requested a report setting out issues of concern in the insurance industry, Mr. Roux replied by pointing to the disjointed nature of insurance regulation and he said the 40% vacancy rate in the Central Bank's insurance enforcement section meant it lacked the powers and staff necessary to do its job properly.

Therefore, we do not have regulation over this industry. In fact, the Minister, Deputy Noonan, said it is impossible to regulate this industry due to the EU framework directive on insurance, which prevents a government from regulating it. This points to a problem. What are we doing believing this great institution called the European Union is somehow best for this country when, even on a simple thing like this, it is holding us back from being able to regulate an industry which is crucifying people earning less and less money? The examples have been given of the extraordinary insurance increases in all areas, whether it is for a farmer, a fisherman, a worker, somebody cycling a bike or somebody driving a car, or in regard to the increased level of flooding or the cost of covering home insurance. It is a big issue. It needs to be regulated and it is about time this House got hold of it.

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