Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I wish to rationalise those numbers. My understanding is that the new levy applies to gross written motor premiums. Therefore, the insurance compensation fund, ICF, levy is for all non-life policies. In effect, the Minister of State is saying, broadly speaking, that the amount to be applied to motor premiums accounts for approximately half of the non-life insurance book. According to the research we have, the ICF contribution is approximately €70 million per annum. The Minister of State is saying that the new fund, with a levy of 2%, will collect between €34 million and €40 million per annum. It would take approximately four years to get to the €150 million target. The Government will then reduce the rate to 1% and it will be in place for a further three years. For the next seven years people are looking at 3% stamp duty, which is permanent because it is taxation. Then, they are looking at the 2% insurance compensation fund levy, which will apply to all non-life insurance policies for the next three or four years. That will go towards the new motor insurance insolvency compensation fund. Then, for the following three or four years the rate will be 1%.

Am I right in saying that, provided there is no further drawdown from the insurance compensation fund to clear out the legacy liability from Quinn Insurance, we are looking at probably another 12 years? Is the intention then that the levy will remain in place to build up the fund? It is in deficit currently to the tune of €800 million. Would it remain in place in future to build up a fund?

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