Alan Kelly (Tipperary, Labour) | Oireachtas source

The Labour Party will support the motion which is a good one. I congratulate my colleagues across the floor on putting it forward. It is very badly needed and many in the House will support it. We need it because we need to do something about the insurance industry. It is as simple as that. I have seen this before in other areas also and the industry certainly needs the scrutiny of this House. I welcome the debate because of the critical importance of affordability in transport provision for commuters, motorists and small businesses throughout the country.

The increases of 60% since 2014 and 34% in the past 12 months are nothing short of scandalous. I mean this sincerely because to an alarming degree they are having real effects on people's lives. This topic was discussed recently on my local radio station, Tipp FM. It was said afterwards that very few items discussed on such a show on a rural station had received as much attention. That shows how much the issue has heated up, particularly in rural Ireland, where public transport is not available to the same level and people are very much dependent on the car. This applies throughout the country. It may not necessarily be a priority in Ranelagh, but the Government has stated rural Ireland is a priority and, if that is so, it should tackle this issue because it is central to people living in rural Ireland.

I will not repeat some of the comments of previous speakers, but I have been frightened by some of the examples I have seen. In an earlier life I had responsibility for regulating the taxi industry. Speaking again about rural Ireland, there has been a diminution in the number of hackneys in rural Ireland. They are very much a necessity in getting around and keeping localities vibrant, but because insurance premiums are increasing so much they simply cannot stay on the road. This is a critical issue. I have heard about numerous small businesses that have received incredible quotes for their vehicles. Just as they are trying to move on to get out of the slump, they are hit by this. I really want the Government to act and with the support of the Dáil because the short-sightedness of the insurance industry will lead, regardless of whether we like it, to a number of people driving on the roads without insurance and we do not want that to happen.

I have to be honest. I have a real problem with the insurance industry. I experienced it when it came to managing the effects of flooding in the past couple of years. I found it not to be sincere in the way it dealt with the issue and think it is not sincere in the way it is dealing with this issue either. There is a lack of transparency on data management - this issue comes up across the board when it comes to the insurance industry - and in the way it maps and uses data to justify whatever means it wants to use and whatever decision it wants to come up with for a particular category of people, whether they be the elderly or people who were living elsewhere in Europe or America. It also applies, in particular, to young people who have been adversely affected.

The industry is peddling yarns. There is no doubt that there have been issues relating to Quinn Insurance, Setanta Insurance, the levels of reserves and undervaluing. However, the industry is peddling yarns when it seeks to justify increases based on the spiralling cost of claims and the corresponding legal fees. Barristers fees have fallen. Therefore, legal costs have changed. The Courts Service and the Injuries Board do not support the statements made by the industry that increasing awards in personal injury cases are a major factor in the cost to consumers. In fact, the increases in the awards made by the Injuries Board are modest at best and in small, single figures. There seems to be quite a gulf between the industry's explanations and what is true. Therefore, we need to get to the bottom of the issue.

In addition, insurers should be obliged to provide information for customers on changes to their charges and the changes should be justified. There is a need for transparency in increases in premiums. We made changes to provide for transparency in a range of other areas, including, for instance, in the sale of houses. Why can we not make changes in order that all increases in premiums will be displayed and justified? If we were to do this, we would get back to the point I made about data being massaged to justify what the industry wants to do and, in particular, how it treats risk.

We know that insurance fraud is a real issue which plays no small part in explaining the rise in premiums. Falsely exaggerated and invidious claims made by a small section of society are giving rise to additional expense for all law-abiding citizens in their premiums. In recent weeks there has been the much publicised of a number of individuals. I will not get into the specifics, but it was quite obvious from what the judge had outlined that it was one of a number of cases in which individuals had made fraudulent claims. In such situations it is quite clear that the people involved need to be penalised severely. Not alone that, the Garda also needs to get involved very quickly.

Insurance companies cannot be allowed to act as unregulated bandits. We must ensure the way in which they perform their functions is transparent and that they work within a code. We must ensure the task force to be set up will have real teeth and that the manner in which it will do its work will be quick. We must ensure we can isolate those who have been targeted who include the proprietors of small businesses, younger people, older people and people returning home to Ireland. They also include those who have older cars which have passed the national car test, NCT, but who are still being charged exorbitant premiums, even though their cars have been certified as being roadworthy for a year or two, as the case may be. The Labour Party will support the motion and looks forward to seeing how the Government will ensure action is taken to support people, in particular those living in rural areas.

I wish to raise another issue which has not yet been raised but about which I have a real concern - how end-of-life vehicles are treated. It is an issue for the insurance industry. It is a serious issue in terms of road safety and the insurance industry not wanting to take responsibility. It is my belief that, because of the way the legislation has been set, some end-of-life vehicles end up back on the road. In fact, I know that they do. I have spoken to breakers who have told me about the issue. These vehicles are being driven by young people and others because the legislation dealing with how end-of-life vehicles are treated is not sufficiently robust. I will not get into the detail of the categories, except to say there are four. In many cases, it is not mandatory for insurance companies to ensure end-of-life vehicles are scrapped. Unlike in the United Kingdom, there is no mandatory certification. It is voluntary. In some cases, insurance companies are not following up. Hence, some people ensure cars are sold on. If they have been imported, it is easier to do this and it causes premiums to increase. The insurance industry is not taking responsibility where it should. In many cases, a vehicle is left in the name of the original owner who, when it is involved in an accident, is held responsible. This is completely unacceptable, given that the insurance company involved has already written off the vehicle.

There is a gap in the legislation. I have spoken to officials in the Department of Transport, Tourism and Sport about the issue, yet months later nothing has happened. I ask the Government, through the Minister of State, to ensure it is dealt with because it will have a huge impact on road safety and is having an impact on the premiums charged by the insurance industry.

This is impacting on the insurance industry and on insurance premiums. The insurance industry and not individuals must be responsible for certifying that vehicles written off are written off. Once an insurance company assesses a vehicle it should become the owner of the pathway for the destruction of that vehicle. There are people driving on the roads of Ireland tonight in cars that should be scrapped but have not been because of a gap in the legislation.

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