John Curran (Dublin Mid West, Fianna Fail) | Oireachtas source

I welcome the opportunity to make a short contribution to this legislation. I support what the Bill purports to do.

I wish to acknowledge and put on record that this is the second tranche of legislation in recent times dealing with the issue around the cost of insurance. The Central Bank (National Claims Information Database) Bill was before the House during the past month. I do not want to look at this as stand-alone legislation. It is part of a programme and I need to acknowledge that.

I have no wish to sound too critical of the Government, yet when I spoke in the House some weeks ago, the Minister reminded me that the 2017 CSO figures showed a reduction in motor insurance of 11%. The Minister was quite right to say that.

I did not have the exact figures with me at the time, but I will allude to them. The annual rate of motor insurance increased by 11.6% in 2014 and by over 30% in 2015. These are significant increases. I mention this because it shows how long we have had to deal with this matter. The issue was identifiable in 2014 and 2015 and it is only now we are beginning to come to terms with it.

In looking at this legislation I was conscious that when I was elected in 2002, insurance costs, specifically motor insurance costs, were at very high levels. A candidate in my constituency ran on the sole issue of motor insurance costs and secured more than 1,000 first preference votes. I will not give the Minister a history lesson, but if I am not mistaken, the Personal Injuries Assessment Board, PIAB, legislation was passed in 2003 and became operational in 2004. The PIAB was set up and established within a couple of years of that and in its early years, as a result of the manner in which it was set up and the number of claims it settled, we saw significant reductions in the cost of insurance. My memory of the 2002 election is that we saw the impact of PIAB within two or three years. I referred to the rates of increase in insurance costs in 2014 and 2015, in particular, the latter when the cost of motor insurance increased by more than 30%. It has taken us a good number of years to get to the stage of bringing forward legislative proposals to reduce costs.

The Minister heard the contribution made by Deputy Kelleher who will work collaboratively with her to ensure all Stages are passed and the legislation is implemented. That is the challenge. It is important that we are somewhat timely in doing so.

The costs associated with claims are preventing premiums from being reduced. Claims for whiplash were mentioned, in particular, the awards for whiplash in Ireland versus those in the United Kingdom. Awards here are four or five times the typical payment for whiplash in the United Kingdom. PIAB figures show whiplash awards average approximately €20,000 per person. I was not surprised by that figure because reading over my notes, I realised that a year and a half ago, in April 2017, Charlie Taylor wrote in an article in The Irish Times that the average award was €15,000. He also noted that motorists here could save €150 a year in insurance costs if our awards were reduced to the European or UK average. This problem has been around a long time. I am glad the legislation is before the House. I am conscious that it seems to have taken a long time to get it here, and I hope we can conclude it quickly.

Deputy Kelleher spoke about the cost of fraud. As he stated, many recent cases have been thrown out of court and there is little or no sanction for those who make claims that are not upheld. That cost is incurred by insurance companies. Separate from cases getting as far as the courts in the first place, I understand insurance companies spend significant amounts of money validating claims and having investigators examine them to ensure they are not fraudulent. The cost of fraudulent claims is significant and, ultimately, that is reflected in the premiums we all pay.

Deputy Eugene Murphy spoke about the cost of insurance for young drivers. Other speakers mentioned the cost of insurance for young drivers in rural Ireland. As the father of a young driver, I can say insurance for young drivers is very expensive and they also find it very difficult to even get a quote. There are major challenges in that regard. The Minister might say I am not living in rural Ireland and my son does not need a car. While many young people do not need a car, it is important that they can drive, particularly in terms of future career prospects. If they learn to drive at a younger age, it comes easier to them. The cost of insurance for younger drivers is a significant issue.

The Minister mentioned people engaging with independent medical examiners. That is very important. We need to understand fully the reason our payouts, in particular for soft tissue injuries, are so much higher than those in other jurisdictions. We are all paying for this and independent medical examinations are required very early in the process. I have spoken to people who have suffered injuries and they say the injury endures for a significant period. However, medical examinations should be carried out during that period to determine the real or perceived extent of the injury.

The book of quantum plays a key role and sets the bar. As Deputy Kelleher rightly stated, it needs to be more than a reflection of court payments. It needs to reflect payments in similar jurisdictions where the cost of living is similar to the cost of living here, rather than jurisdictions that are radically different from ours. I do not understand the reason for the difference in payouts in this jurisdiction, which are multiples of those made in the UK. That is the case in certain payouts, and it is not appropriate. The book of quantum needs to reflect more than just what the courts award.

I mentioned fraud. Legislation must be enacted quickly to deal with people who commit fraud, which is currently a crime without sanction. Fraudulent claimants walk away as if they had done nothing wrong, whereas they have created significant costs. Such cases should not reach court. If fraud is identified anywhere in the process, from the time the claim is made, a sanction or charge has to be imposed on the person because such claimants create costs for the insurance companies.

While this side of the House is supportive of the Bill, we would be more supportive if the Minister were to advance and conclude the legislation more quickly.

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