James Browne (Wexford, Fianna Fail) | Oireachtas source

I welcome the opportunity to speak on this Fianna Fáil Bill which seeks to increase dramatically the penalties for those who commit insurance fraud. I am calling for urgent action by Government to tackle rising insurance costs. The message for the Government is that this issue must be a priority. To date, there is no sign of urgency, only lethargy. There is a phenomenal amount of anger, frustration and disappointment at the lack of progress in dealing with the issue of rising insurance costs. Motor insurance and public liability insurance are increasing at unsustainable rates. Added to this is the increase in excess levels and expanded exclusion clauses included in insurance policies.

Businesses throughout the country are facing crippling costs for insurance. Businesses are closing, jobs are being lost, and our economy is being undermined. I have dealt with many businesses in Gorey, Enniscorthy, Wexford, New Ross, Bunclody, Ferns and throughout the county of Wexford that are struggling to remain open. Charities, community groups and sports clubs are all badly affected. Many businesses have experienced substantial and unjustifiable insurance increases. Honest people are suffering. The majority of claims made under insurance policies are legitimate. There are two major issues concerning claims. First, in the case of legitimate claims, payouts by courts are more than four times those of comparable claims in the UK. This is unacceptable and unsustainable. Second, there is a serious level of fraudulent claims. We are all aware of many instances of fraudulent or exaggerated claims being made and settled. There have been instances of policyholders pleading with insurance companies to contest these claims but to no avail.

We need to get tough on insurance fraud. We need to tackle the insurance fraud culture in Ireland. It is not a victimless crime. Insurance fraud costs us all. We need to see tough penalties imposed on those who take false claims. This Bill seeks to increase the penalties for those who bring fraudulent claims. Section 26 of the Civil Liability and Courts Act 2004 makes it an offence knowingly to give evidence that is false and misleading. If a claim is dismissed because of section 26, it ignores the significant costs incurred by either the defendant or the insurance company defending the claim. To defend a case in the court of law is expensive and it puts many people off defending a claim. This Bill stipulates that where a case is dismissed under section 26, the claimant will have to pay the legal costs of the defendant. This will not only compensate defendants but also act as a significant deterrent to insurance fraudsters. In addition, the Bill seeks to increase the maximum fine on summary conviction to a class A fine, which currently stands at €5,000. Currently, the maximum penalty on summary conviction is a prison sentence of up to 12 months and-or a fine of €3,000. This Bill seeks to increase the time served for a conviction to a maximum penalty of up to ten years in prison and-or a fine of up to €100,000.

This Government is once again playing catch-up on insurance reform. It has yet to establish a national claims information database to track the level of claims, which was to have been done by June 2018. It has yet to tackle insurance fraud, to establish a judicial council to compile guidelines for general damages relating to personal injuries, to establish a publicly funded anti-fraud unit in An Garda Síochána, to establish a business insurance premium index that would track prices over time, and yet to take any action towards stabilising personal injury claims. All the while the European Commission and the Competition and Consumer Protection Commission continue to investigate the industry for anti-competitive behaviour. The Fine Gael-Independents Government has a mandate from this House to make the necessary reforms to tackle insurance fraud. It is wasting that mandate in its failure to address the serious crisis of the rising cost of insurance. This Fianna Fáil Bill, which seeks to increase dramatically the penalties on those who commit insurance fraud, sends out a clear message. The Government needs to listen and to act to prevent more businesses closing.

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