Thursday, 20 September 2018
Central Bank (National Claims Information Database) Bill 2018: Second Stage
I welcome the opportunity to speak on the Central Bank (National Claims Information Database) Bill 2018.
It comes from one of the recommendations of the cost of insurance working group which urged the setting up of a national claims information database. We are all too well aware of the crippling insurance costs experienced by anyone with car, home, farm, business and even pet insurance. The list is endless because the bottom line is that insurance costs have risen to an all-time high. One of the purposes of this Bill is to provide transparency on motor insurance costs. This will facilitate a more in-depth analysis of motor insurance claims trends which is key to understanding how claims costs are impacting premiums. I welcome this because we urgently need transparency in the insurance industry and costs, which are crippling people, must be reduced.
It is believed the identification of settlement channel information should lead to greater consistency in award levels and a greater use of the Personal Injuries Assessment Board. This, in turn, should lead to a more stable claims environment which should have positive impacts on the price of insurance paid by consumers.
I stand here with bated breath waiting to see if this promise of transparency will lead to reduced premiums or if it is another promise that will look good in the headlines but will never have a real effect for the people of Ireland. For more than two years, I have begged in this Chamber for something to be done about rising insurance costs. I am inundated, as other Deputies must be, with constituents contacting me distressed and upset about the quotes they are getting for motor insurance. Will this be a solution, finally, to this problem? Will people finally see their insurance premiums reducing?
We need to examine the issue of returning emigrants accessing motor insurance and ensure they are not priced out of the market. During the economic downturn, many of our youth emigrated to countries around the world. That trend is reversing as many of those people now want to return home. Not only will many of them face difficulty obtaining driver licences, which is absurd because many of them already have full driving licences in other countries, but they must start from scratch here. They must do the required number of driving lessons and will need a fully licensed driver to accompany them for a period of time. That is outrageous as these are experienced drivers. We must make allowances for Irish people returning home after years abroad. We should make it easier for them to return home rather than put obstacles in their way. The quotes people are receiving for motor insurance when they return home are off the scale. We need to address this issue and take all necessary steps to encourage people who had to emigrate during the downturn to return home. We should promise them affordable motor insurance and give consideration to the non-Irish driving licences they hold and the years of driving experience they have, regardless of whether that experience was gained outside Ireland.
Businesses have suffered greatly as a result of crippling insurance costs. A wonderful business, West Cork Secret, in Kilbrittain, which is known as the secret garden, has found its insurance cost has increased from under €5,000 a year to in excess of €20,000. The owners told me about the hike in their insurance cost before going public a few months ago. That huge increase could wipe out their business as they are struggling to keep their doors open. As popular as the secret garden in Kilbrittain is, it cannot continue or sustain such an outrageous hit. How does the Minister of State expect any business to be able to cover an insurance hike as high as that? This business is an extremely important amenity in west Cork. It is used by people far and wide and gives employment in a rural area. Why are we allowing such businesses to face such crippling insurance costs? This issue needs to be addressed as a matter of urgency.
I have seen a number of business in west Cork close in the past two weeks. I am not saying those closures were directly related to insurance costs but the rising cost of insurance premiums for businesses is putting enormous pressure on them and does not in any way help to keep the doors open.
Garage owners have told me they are facing huge insurance premiums. Consumers are tired of rising costs. Garages are struggling to keep their doors open and their costs low for consumers but they have to bear the cost of outrageous insurance premiums.
Another sector that is suffering greatly is self-employed tradespersons. Their insurance costs are extremely high as standard. It is normal in any business to have a claim on one's insurance at some point. However, but when even a minor claim is made by a tradesperson, it gives rise to inflated insurance premiums the following year. How can we expect tradespersons to make a living when they are up against these types of rising costs?
We are afraid to tackle the insurance companies. They are paying out on foot of many insurance claims when they should be stronger in fighting cases. They are stepping back from doing so because they find it is cheaper to pay out. I have experienced that in a community and voluntary group in which I am involved. I have seen pay-outs being made on foot of insurance claims that the insurance company should not have paid. There were very suspicious claims. This puts great pressure on the community and voluntary sector. Regardless of whether one is a councillor or has another role in the community, organisations that are in any way active in the community are paying a few thousand euro for insurance annually. That is a terrible burden for a voluntary organisation which must raise funds to pay for it in the community.
I mentioned motor insurance. We have to single out young drivers who are trying to pay huge bills. Some of them are just working to keep their car on the road. It may be a lovely car but the insurance costs a hell of a lot more than the car, which is terribly unfair.
Recently, AXA Insurance sent out a letter to its customers in Castletownbere and surrounding areas in west Cork stating that its Bantry office is to close. Customers were advised that when the office closes, they should travel to Midleton if they need to go to an office. That is a distance of 147 km each way, which is a journey of two hours and ten minutes by car and a return journey of four hours and 20 minutes. If I had been told that on 1 April, I would have thought it was an April fool's joke being inflicted on the people of west Cork. How can AXA Insurance think that is acceptable for its customers? It is outrageous that the company can simply withdraw its services in rural Ireland, in this case in Bantry in west Cork. It is a continuation of the closure of services in rural Ireland and AXA Insurance is getting away with it. The company has no problem taking people's money but it has a major problem maintaining a manned personal service that has been in place in Bantry for many decades. I ask the Minister of State to intervene on that issue.
We have seen the closure of post offices. I could go on forever talking about closures, but this is a very serious issue for the people of west Cork. AXA Insurance, like other insurance companies that are turning over handsome profits, is not showing any respect for its customers in west Cork. It expects people to make a return journey of four hours and 20 minutes to talk to someone or else go online. For many people in rural Ireland, the only line they know is a clothes line. Not everybody sits in front of a computer to sort out these issues.
People sometimes need to talk to a person face to face. A person who is hit with a massive insurance bill will need to go into the office of the insurance company to discuss it. He or she cannot be expected to spend ages on the telephone dealing with the issue or to hit a button on a computer which may or may not work and, if not, it is a case of tough luck. That shows total and utter disrespect for the customer. I urge the Minister of State to intervene in this case if he has powers. Perhaps the insurance companies are untouchable. He should tell AXA Insurance it is not allowed to close its branches in rural Ireland. It is not the case that it has a branch in every town. I know of only one branch in my constituency, namely, the Bantry office. The nearest office to Bantry is in Midleton, which is in another constituency. The company is walking away from the people of west Cork. I would advise the customers of AXA Insurance or any other insurance company that wants to walk away from them to seriously consider walking away from the company. That is what needs to happen to such insurance companies. If people want to do their business on the Internet, they can do so but not with companies that have forced them into that position. I urge the Minister of State to step in and ask the insurance companies to come before these Houses and explain the reason they are closing branches and walking out of rural Ireland. That would be appreciated.