Willie O'Dea (Limerick City, Fianna Fail) | Oireachtas source

That is a first. I congratulate the Minister on his appointment, and wish him the very best and a long and profitable period in his position. I also want to congratulate my colleague, Deputy McGrath, on bringing forward this very timely motion. Due to time constraints, I cannot discuss the structural problems of the insurance industry or the implications of Setanta and Quinn. Therefore, I will confine myself to making a few general points.

One of the main determinants of the amount one pays into any fund, including insurance funds, is how much the fund has to pay out because, after all, it is a commercial operation. There is no doubt that the amounts paid out here by way of insurance awards are dramatically out of line with the rest of the world. For example, some 80% of minor car accident injuries in Ireland involve whiplash. Whiplash awards here are about three times the level they are in the UK and are an even greater multiple of the amounts in other jurisdictions. There is no logical basis whatsoever for this. What is the justification for it?

Another problem with the costs incurred that determine how much people have to pay into an insurance fund is the process by which awards are now determined. As Deputy Grealish and others said, we set up the Personal Injuries Assessment Board, PIAB, to deal with the level of costs in the motor insurance sector. Unfortunately, it has been gradually eroded over the years. I understand it now only deals with about 20% of claims. It was eroded by the legal profession which found a way to get around it by claiming psychological damage, which means claimants are automatically out of the ambit of PIAB.

In addition, the section of the legislation which prevents somebody seeking an offer through PIAB from having an each way bet in terms of rejecting it and going to the courts is not being enforced at all, as far as I can see. For many years it has been suggested that we have a statutory system for all but the most extreme cases, such as cases of very grave personal injury where people have become paraplegics, etc. We currently have what is called a book of quantum, which is supposed to be a list of indicative awards for particular types of injury. However, it is based on the prevailing level of awards which means that it is quite useless. If we base awards on the book of quantum, the only way insurance premiums can go is upwards.

Premiums have risen by over 60% over the past three years. I have received the latest figures from the CSO, which show that in the 12 months to the end of May, insurance costs in Ireland rose by 35.5%. There is no logical justification whatsoever for that. It is long past time that we took action to deal with the issue.

Deputy McGrath's motion proposes a task force. I note the Minister for Finance told the House there would be a review. When he addressed the House yesterday, the review miraculously morphed into a Department of Finance task force. More surprisingly, at the end of his speech the Minister said when the task force eventually reports, there might then be a need for another task force, I presume along the lines of what is proposed by Deputy McGrath, to examine the problem further. With all due respect to the Minister for Finance, who is a good constituency colleague of mine, that does not indicate that the Government accepts the urgency which attaches to this problem.

Over the past two years we have had debates, analysis, scrutiny and discussions, but now we need action.

It seems to me that a task force along the lines proposed by Deputy Michael McGrath, provided the Government's puts a time limit on it, would be the springboard to action in that regard. Action is badly needed. Other speakers have pointed out how the increased cost of insurance is eroding disposable income, costing jobs and damaging the economy. It is a matter of great urgency, particularly when one considers the 35.5% increase in the past 12 months. It is time to do something. I urge the Government to accept the motion and to proceed with the task force without delay.

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