Brendan Ryan (Dublin Fingal, Labour) | Oireachtas source

I am glad to have the opportunity to speak on this very important issue. As this is my first time to address the Thirty-second Dáil, I would like to take a moment to thank my constituents for their support in the recent general election. I am extremely proud to have the opportunity to continue to represent the people of Dublin Fingal in this House.

As was mentioned by the Minister for Finance, Deputy Noonan, the Department of Finance is currently conducting a review of policy in the insurance sector. I welcome this review. It is absolutely necessary and urgent. As was noted by the Minister, Ireland's insurance industry has managed to come through the financial downturn intact and is still providing Irish jobs and contributing to our economy in a significant way. Yet it has faced many challenges over the past five years which cannot be ignored. We need only to look at the CSO figures to know that insurance costs have been rising steadily in Ireland for the past five years. Since 2011 there has been a 29.6% rise in insurance prices. Motor insurance, in particular, is an area of concern. Motor insurance prices have risen 33.5% since 2011. In the past 12 months, there has been a 26% rise. This rate of increase is not sustainable for consumers, businesses or insurance providers. These increases are killing struggling households.

The National Competitiveness Council has highlighted the need to address this issue so as to avoid stagnation in the insurance market and, therefore, less competition. Its research has found the Irish non-life insurance market to be relatively competitive, but the market remains unattractive for new entrants due to low levels of profitability. Both the National Competitiveness Council and Insurance Ireland have identified solutions to many of the problems faced by the industry here.

I would like to take few moments to bring to the Minister's attention just a few key issues which have to be addressed. There is a deficit of data surrounding insurance claims in Ireland. A lack of publicly available information has made it more difficult for the industry and ourselves to assess the factors driving up insurance costs. There is a need to comprehensively benchmark insurance costs and the drivers of costs in Ireland. This cannot be done until the causes of rising insurance costs are properly identified. Data needs to be collected from the industry. With regard to claims, more in-depth information would facilitate a better understanding of the problem. The National Competitiveness Council has recommended that this could be addressed by simply collecting data on claims assessed by the PIAB and claims settled through litigation. We are never going to find a long-term solution to these spiralling insurance costs if we do not collect the necessary information about their cause. The PIAB needs to be empowered to conduct this data collection.

Any new legislation on this matter needs also to address the challenges faced by the PIAB. One such challenge is the non-attendance of claimants at PIAB medical examinations. Just last week, Kevin Thompson of Insurance Ireland pointed to the right of claimants not to attend PIAB medical examinations as a serious stumbling block in the effectiveness of that body. If the board cannot mandate that those seeking insurance claims must do something as simple as attending a medical examination for assessment of their injuries, how can it be expected to be effective in its assessments of insurance going forward?

Another issue that must be addressed in light of rising insurance premiums is the simple yet crucial step of enforcing health and safety legislation. One example is the crucial area of motor insurance claims. As I mentioned previously, motor insurance prices have risen by 33.5% since 2011. We need to ensure that An Garda Síochána and the Road Safety Authority are fully equipped and supported to maintain an adequate level of enforcement of road safety laws. I am sure we are all aware of Garda figures released last week which show a drop in the number of drink-driving tests administered by gardaí. This, coupled with falling numbers of gardaí serving in the traffic corps, from 1,200 in 2009 down to 750 in 2015, is an issue that needs to be addressed and has become a point of concern for the Road Safety Authority. I am sure we all agree that prevention is better than cure, and the fewer road traffic incidents there are on Irish roads, naturally, the fewer insurance claims we will have to deal with.

The final concern I will raise on this issue is that of rising legal services costs associated with the insurance industry. The cost of legal services has been cited by the insurance industry as a contributing factor in the rise of insurance prices. While the Legal Services Regulation Act 2015 goes some way towards addressing the problem, work still needs to be done with regard to the cost of legal services, such as improving case management in the courts. A key contributor to this is the fact that almost all claimants through the PIAB are represented by solicitors. This is rather surprising, given that the board was established in the first place to reduce the need for legal representation for claimants, which was in part, at the time, an attempt to reduce legal costs in insurance claims. These costs associated with legal services in the insurance industry are resulting in a need for higher awards and, by extension, higher insurance premiums.

It is my hope that the concerns raised by all Members of the House who have spoken on this issue today are dealt with head-on by the Minister and his Department, and I welcome the ongoing policy review being conducted by the Department of Finance. However, this must be brought to a speedy conclusion and any recommendations implemented quickly. All of this will be driven by the need to have a Government. I therefore urge a speedy conclusion to that process so that the new Minister, whoever he or she may be, can begin to deal with the issues addressed in this House this week and last.

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