Billy Kelleher (Cork North Central, Fianna Fail) | Oireachtas source

I welcome the opportunity to speak. It is important to keep highlighting that there is a major problem in society and across the economy relating to the cost of insurance, including motor insurance, public liability and other insurance that is required to be taken out to cover liabilities. We have been discussing this issue for a long time. Certain actions have been taken but they are primarily establishing the facts as opposed to dealing with the consequences of them. We established the cost of motor insurance working group, which made recommendations and other recommendations followed from that. We have been slow in implementing these recommendations, which would have a profound impact on the cost of insurance.

The cost of insurance disproportionately affects certain sections of society and the economy. For example, motor insurance disproportionately affects those on lower incomes and living in rural areas. It has a profound impact on people on lower incomes who must often travel long distances for work because the areas they live in are determined by their low incomes. This is an attack on their entitlement to at least provide a reasonable standard of living for themselves. When people are paying €2,000 or €3,000 for car insurance, it can have a profound and disproportionate effect on families with low incomes.

The exorbitant cost of insurance also has a disproportionate effect on young people. The cost of motor insurance has a disproportionate effect on rural Ireland. The Minister represents a rural constituency. People in rural areas spend a vast amount of time travelling by car to and from places of work and education and to socialise. There needs to be an immediate effort to address many of these severe impediments to people.

The Fianna Fáil Party welcomes the Bill and hopes it quickly goes through the legislative process and has the intended impact. It has been drafted well and there has been broad consultation on it. There is also an acknowledgement that it reflects elements of the Bill my party published in July. Our Bill at least nudged this legislation in a certain direction and we welcome that. The public consultation of 2014 was followed by the working group on the cost of insurance, which has made its recommendations, some of which are included in the Bill.

Public liability insurance, which businesses must take out, has a profound impact. Those who take out this insurance are largely law-abiding and provide employment. Scamming through fraudulent claims takes place across this country. It is consistent and has reached epidemic proportions. We turned a blind eye to it for a long time because we were happy to keep loading the premiums. Businesses and people taking out motor insurance would keep paying. Something had to give, and what gave was that people could no longer afford car insurance. This caused an outcry and we are now reacting. In the context of business, we have to accept that we cannot assume that business can keep paying exorbitant increases in insurance. Insurance in some places now costs more than rates. This issue also has to be addressed.

The main reasons for the escalating cost of insurance are the significant legal costs arising from litigation and the cost of fraudulent claims. Fraudulent claims are built in to the premiums actuarially now and we do nothing about them. Legislators, law enforcement, courts and public prosecutors do nothing about it. There have been no prosecutions of people who go to court, lie, present fraudulent evidence under oath and take up court time telling barefaced lies and presenting fraudulent evidence. In the end, if a claims is struck out because it is fraudulent, there is no sanction. Fraudulent insurance claims are crimes without sanction or consequence. If someone goes into a shop, hops over the counter and takes money out of the till, there is a sanction. There will be a Garda investigation and perhaps a prosecution and conviction. However, someone can go into the same shop, intentional fall in the toilet, pretend to be hurt and go to court seeking compensation. If it is found that the claim was fraudulent and the claimant has committed perjury, there is no sanction. The case is struck out and the claimant walks out of the court. That has to be addressed because it adds a significant cost to insurance premiums and, therefore, businesses. This sometimes forces legitimate businesses to cut corners elsewhere because they have to pay rates, insurance and staff and other things suffer.

It is inherently wrong that law-abiding people are not supported by the apparatus of the State when people who try to scam them are not prosecuted by law agencies. That is profoundly unfair. The Taoiseach talks about wanting to represent people who get up early in the morning. Most people who take out car insurance and most businesses which have to take out public liability insurance, including farmers, hoteliers, shopkeepers and others, also have to get up and make a positive contribution to society and the economy. Nothing is done for them when they are victims of a fraudulent claim. Not only does this have a cost, but it also has a profound impact on individuals who are trying to pay their bills and staff and do what it is right in compliance with the law. They see this happening and the State offers them no support.

However, I assure the Minister that the day they cut a corner the long arm of the State will be very quickly extended to them. That issue must be addressed. Recently, probably due to the issue being highlighted, at long last we have seen an effort being made by the insurance companies to contest claims and unearth fraudulent claims and those who perjure themselves in court. That is welcome, but we must go a step further and introduce a sanction, whereby there would be a consequence if one intentionally perjured oneself by presenting fraudulent evidence.

The Minister accepted on Second Stage the Private Members’ Bill we published. As long as the legislation is introduced, I am not fussy about who takes responsibility for it, be it the Minister, the Department or this side of the House. The main point is that law-abiding citizens would see they had some support and protection from such criminals, because that is what they are. I hope the Civil Liability and Courts (Amendment) Bill which intends to amend section 26 of the Act will be brought before the committee. As it is a Private Members' Bill, I believe it is waiting for a money message from the powers that be to allow it to move forward. I urge the Minister to use her good offices to try to ensure that either she progresses the measure, which would be fine by me, or that it will be progressed by our side without the impediment of a money message being used to quash it.

Insurance is a noble concept, the purpose of which is to protect a person who is injured and that system must be protected. The PIAB is a good concept. We welcome the provisions included in the Bill that will strengthen it and encourage more people to go through the PIAB process. People must be obligated to at least co-operate with the PIAB when it is making assessments.

The book of quantum must be continually reviewed. In his report Mr. Justice Nicholas Kearns was scathing of the awards being made. High awards do have an impact. It is reasonable to make high awards to those who are legitimately injured, but it is unconscionable to make awards to those who are not injured and that happens every day of the week. That issue must be addressed. The PIAB will review the book of quantum on a continual basis. It should adjudicate on the awards it delivers by basing them on awards made in comparable jurisdictions, rather than using the highest court awards as the benchmark. If we consistently move towards the highest award, the high awards made by a court will become the benchmark for everybody. I presume the legal profession like high awards, given that 10% of a high award is better than 10% of a lower one. There is an inherent incentive for the system to support higher awards and for them to continue to increase. That issue must be addressed to ensure that when assessments are made of personal injuries, they are based on the norm in other jurisdictions, rather than what happens in the courts on a regular basis. I feel very strongly about that.

The PIAB had an impact when it was set up originally. What has happened over a period is that the legal profession has looked at ways of manoeuvring clients away from it and shepherding them back to the courts which provide more bountiful remuneration. Our obligation is not to fund the Four Courts indirectly through higher awards but to ensure people who are genuinely injured can seek fair compensation and those who try to seek compensation when they are not injured are punished.

I welcome and support the Bill. I thank the Department for its efforts at consultation and the fine drafting involved in the Bill and the fact that it also took on board some of our ideas in this era of new politics. We support that approach. I urge the Minister to consider our Private Members' Bill and allow us to move it forward or her to take ownership of it. I am not a covetous person. The Bill would send a strong message that scammers, fraudsters and criminals would be punished by the State when they tried to dip into the pockets of individuals and businesses through fraudulent claims.

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