Fiona O'Loughlin (Kildare South, Fianna Fail) | Oireachtas source

I am grateful for the opportunity to speak on this hugely important subject. The rising cost of insurance has affected every member of our society, both directly and indirectly. The rising costs reflect a combination of Government-imposed costs, poor regulation, mismanagement by the insurance sector and legislative failure. This applies right across the board to motor insurance, health insurance, public liability insurance and flood insurance.

Many people do not have a choice in regard to running a car because it is an absolute necessity. Regardless of whether it is a choice, everyone who runs a car is hit first with the cost of car insurance before they face into car tax, NCT costs or the ever-fluctuating and heavily taxed price of fuel. The rising cost of motor insurance is a major frustration and one of the biggest consumer issues facing motorists at the moment. Consumer bodies have reported an increase of close to 40% on average over the past 18 months and, for many individual drivers, the increases are even worse.

Information gathered from a number of sources would suggest there are several contributing factors. Figures from Insurance Ireland indicate motor claims costs are rising and the level of awards being made in the courts is at an all-time high. The average High Court award in 2014 was up 34% on 2013 and the average Circuit Court award was up 14% on 2013. In litigated cases, legal costs in Ireland account for more than 60% of the compensation awarded. A task force is certainly required to address the issues. Insurance companies, the courts, the Injuries Board, the Central Bank, the Government and the Garda Síochána must act together. Systems must be put in place in order that compensation is set at levels society can afford.

The Small Firms Association said insurance costs have increased by 29.6% since 2011, with the last year being particularly difficult. I know there are many small businesses in south Kildare that have managed to weather the storm of the recession and should now be in a position to expand and grow. However, they are being hit with insurance costs which have risen 29% since 2011.

Poor regulation and the collapse of Quinn Insurance and, subsequently, Setanta have left a legacy for the insurance industry. It will become impossible to do business in Ireland, both from a domestic and foreign direct investment perspective. Urgent action from Government is required to halt this trend which could have severe consequences for small businesses throughout Ireland. I agree with the SFA in calling for responsibility to address this issue to rest with a single Minister who can co-ordinate the actions needed by different Departments and the Central Bank. This must be prioritised by the new Government.

A particular challenge I want to refer to is the impact on the community sector. Throughout Ireland we have wonderful community groups which organise festivals and cultural and sporting events for the benefit of their communities. They are stymied completely by the rising insurance costs we have seen year on year. Again, this is an area which must be prioritised by the incoming Government.

See this speech in context