Patrick O'Donovan (Limerick County, Fine Gael) | Oireachtas source

First, I apologise for the absence of the Minister of State, Deputy D'Arcy, who is responsible for this area. I am a neighbour of Deputy Michael Moynihan's and many of the issues to which he has referred are familiar to me. I know that this issue concerns him and he has raised it previously. I will ask the Minister of State, Deputy D'Arcy, to correspond with or meet the Deputy about it.

The Government is very conscious of the cost and availability of insurance for those in small and medium-sized businesses across the country. However, while the Minister for Finance is responsible for the development of the legal framework governing financial regulation, neither he nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature and are determined by insurance companies based on an assessment of the risks they are willing to accept. Another constraint the Government faces in addressing this issue is that it is not in a position to direct the courts as to the award levels that should be applied. Unfortunately, therefore, there is no policy or legislative silver bullet which would immediately decrease the cost of insurance. This has also been recognised by the Oireachtas Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach in its report on motor insurance.

In that context, the cost of insurance working group, CIWG, was established to try to improve the environment within which insurers conduct their business. It has produced two reports, one on motor insurance and another on employer and public liability insurance. While significant progress has been made in implementing its recommendations, including amendments to the Civil Liability and Courts Act 2004 and the Personal Injuries Assessment Board Act 2003, and the establishment of the national claims information database in the Central Bank of Ireland, it is clear that the single biggest existing challenge impacting businesses is the level of awards given for relatively minor injuries compared to other jurisdictions, which must be addressed. In this regard, the key recommendation arising from the CIWG reports was the establishment of the Personal Injuries Commission, PIC, and the publication of its two reports. The PIC conducted a benchmarking of award levels between Ireland and other jurisdictions for the first time, which has been very helpful in identifying the scale of the problem. This research showed that award levels for soft tissue injuries in Ireland are 4.4 times higher than in England and Wales. The PIC recommended that a judicial council be established which would compile guidelines for appropriate general damages for various types of personal injury. In carrying out this exercise, the PIC believes that the Judiciary will take account of the jurisprudence of the Court of Appeal, the result of its benchmarking exercise, etc. On foot of this recommendation, the Government, with the support of all parties in the Oireachtas, prioritised the passing of the Judicial Council Act 2019. This Act provides for the establishment of a personal injuries guidelines committee upon the formal establishment of the judicial council. This committee will be tasked with introducing new guidelines to replace the book of quantum.

While some provisions of the Judicial Council Act have been enacted though statutory order by the Minister for Justice and Equality in order to allow background preparations to take place, the judicial council itself has yet to be established. However, the Minister was pleased that the Chief Justice, Mr. Justice Frank Clarke announced at the recent Insurance Ireland fraud conference that he has selected the personal injuries guidelines committee designate and that this committee will meet shortly to commence work on an informal basis. He also noted the balanced composition of the committee, which reflects all court levels. He believes this demonstrates that the Judiciary is giving this matter the priority it deserves. The Government also notes the interim Insurance Ireland CEO, Mr. Gerry Hassett's statement at the same conference, which noted that if award levels come down, premiums will as well. Both the Minister for Finance, Deputy Donohoe, and the Minister of State, Deputy D'Arcy, consider this a very reassuring commitment, to which they intend to hold the insurance industry. I also note that the insurance reform agenda continues to be a major priority for the Government and we believe a recalibration of award levels will go a significant way towards addressing the current affordability and availability of insurance impacting businesses.

I will ask the Minister to revert to the Deputy directly on the European investigation to which the Deputy referred.

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