Mary Butler (Waterford, Fianna Fail) | Oireachtas source

I welcome this opportunity to speak on the Civil Liability and Courts (Amendment) Bill 2019. Fianna Fáil has consistently called for the insurance market to undergo much-needed reform. Unfortunately, this has not been reciprocated by the Government. This is evident in its reluctance to tackle the issues of insurance costs and insurance fraud. Small businesses, in particular, feel the effects of increasing insurance premiums head on. Many small local businesses, such as shops, pubs and farms, have incurred huge increases in insurance costs in recent years and are no longer in business as a result. Many people fear for the future of their small businesses due to increases in insurance costs. We are still waiting on the establishment of a dedicated Garda anti-fraud unit, a national claims information database and a judicial council to provide guidelines for general damages relating to personal injuries.

I am the Chairman of the Joint Committee on Business, Enterprise and Innovation, which decided last year to look at the cost of doing business. Deputy Quinlivan referred to this major issue for competitiveness, especially for small and medium-sized enterprises. A wide range of issues were presented to the committee. The increasing cost of insurance was cited to the committee as one of the main issues affecting the cost of doing business. Among the reasons advanced for the increases in premiums were the increasing levels of awards, insurance fraud and the ensuing legal costs. The level of fraudulent, false or exaggerated claims was highlighted as a major concern by a large number of stakeholders. A number of witnesses told the committee that in the current system, there is little disincentive to make fraudulent, false or exaggerated claims.

The Irish SME Association, ISME, called at the joint committee for a statutory offence of perjury to be introduced so that statements of claim to the Personal Injuries Assessment Board would have to be made under an affidavit of verification. The committee heard that perjury is a common law offence in Ireland. We were told that levels of investigation and prosecution are very low, with just eight convictions since 2005. The committee recommended that the Government should examine the feasibility of updating the law on the offence of perjury.

Many citizens make injury claims. While the vast majority of these claims are made in good faith, we cannot overlook the issue of fraudulent claims. Section 26 of the Civil Liability and Courts Act 2004 outlines the guidelines surrounding fraudulent and exaggerated claims. It provides that it is an offence knowingly to give false or misleading information throughout the course of a claim. If a claim is dismissed under section 26, a cost is still incurred by the defendant. It is very expensive to defend a case in the courts. This deters many people from wanting to defend a fraudulent claim. For this reason, the Bill suggests that where a case is dismissed under section 26, the claimant will have to pay the legal costs of the defendant in question with discretion from the court. This will compensate defendants while significantly reducing the number of fraudulent claims by acting as a hindrance to those who are considering making dishonest claims.

We can suggest many measures to tackle increasing insurance costs and insurance fraud. Without follow-up action, however, we will not see the benefits of these implementations. It is unacceptable that we are still without a dedicated Garda unit that is specifically tasked with fighting insurance fraud.

This was one area the committee examined. The Alliance for Insurance Reform calls specifically for the establishment of a Garda insurance fraud unit. The cost of insurance working group recommended examining the feasibility of a specialised and dedicated insurance fraud unit within An Garda Síochána. Insurance Ireland also supports in principle an independent Garda fraud unit. The committee recommended the establishment of a Garda insurance fraud unit.

Most people are honest and make claims when it is justified. Indeed, there are many who do not claim when they could. There are, however, a few who take advantage of the high personal injuries awards available in the Irish system. There is absolutely no deterrent for those who do this. This practice is a consequence of the level of awards in Ireland, which is way out of sync with that in other jurisdictions.

The costs to businesses as a result of insurance fraud and an insurance fraud culture that has escalated have cost us all. Is now time for action. This Bill should seriously be considered by all parties and none as a start.

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