Wednesday, 13 March 2019
Business Insurance: Motion [Private Members]
I thank Fianna Fáil for the motion. I agree with the overall thrust of it and the various measures proposed to try to deal with high insurance costs. Costs have tailed off a bit for motorists but are still significantly impacting home insurance, business insurance, public liability insurance and so on where insurance premium increases have been very dramatic and punitive for some customers.
Following on from the last speaker, the elephant in the room in all this is the profit taking of the insurance companies themselves. There should be more emphasis on that in the Fianna Fáil motion much as I welcome many of the measures proposed relating to the book of quantum, the PIAB, addressing insurance fraud and so on.
The evidence of the significant increase in profits for some of the biggest insurers shows that even if reforms are brought in to address these areas, the insurance companies do not pass it on in the form of lower premiums.
They just take the profits and run. These measures on their own may not ultimately lead to more affordable insurance or prevent significant hikes in insurance premiums because there is no compulsion on the insurance companies to pass on the benefits of reform in the form of lower premiums. This is the issue that has to be addressed. From my point of view, the way to do this is to have a public insurance company. I doubt very much that Fine Gael will go for this but it is what should happen. In previous debates on this issue I pointed out that it has been done elsewhere. One of the best examples I have read about is in Manitoba in Canada where there were significant increases in car insurance of the sort we saw over recent years. As I said, I acknowledge they have tailed off somewhat. Against this background, and it can happen at any time that they just jack up premiums, Manitoba set up a public insurance company that provided basic insurance with third-party cover and personal injury cover at extremely affordable levels. It was a not-for-profit insurance company set up by the state. One does not have to be a socialist to subscribe to the view it would be of benefit to drivers, businesses and homeowners. I do not really see why the Government would set its face against it but certainly to date it has done so.
The other particular group I would like to shout out for with regard to insurance, and notwithstanding there has been some tailing off of the dramatic increases in car insurance which I acknowledge, is that there should be a particular specific regime for taxi drivers. The increases we have seen in recent years, even if they have tailed off, mean the level of insurance that taxi drivers must pay is extremely high. If they lose their no claims bonus they can be in very serious trouble as to the viability of operating as taxi drivers. We should recognise that taxi drivers are an important part of the public transport system, that we need them and that insurance costs can be a real struggle for them. This is something a public insurance company could do, or the Government could take measures to provide a special affordable category of insurance for taxi drivers.
The main message I want to give to the Government is it has to do something about profiteering by insurance companies. If we do not do something, all the reforms and the completion of the various measures from the working group that have not yet been done, even if they do come through and make a difference, will not be passed on to policyholders in the form of cheaper premiums.