Pearse Doherty (Donegal, Sinn Fein) | Oireachtas source

Last week, we had data from the Personal Injuries Assessment Board, PIAB, showing that the average personal injury award has fallen by 50% as a result of the new personal injury guidelines which came in to effect on 24 April of this year. This has halved the cost of awards relating to personal injury claims by insurance companies. It is clear that the reduced cost in claims is not being passed on to consumers in the form of reduced premiums. A survey I conducted since the new personal injury guidelines came in to effect found that 58% of respondents had seen their premiums increase, while only 22% saw reduction fall in their premiums. This trend has been echoed in data from the Alliance for Insurance Reform. That can only mean that these savings are being pocketed by the insurance industry to prop up its profit margins. The Tánaiste knows only too well that that was not the purpose or the objective of the new personal injury guidelines.

Yesterday, the Central Bank published a report on the employer and public liability insurance market. It highlights the insurance crisis faced by small businesses and voluntary and community groups for far too long. It found that between 2013 and 2019, the average premium for employer and public liability insurance increased by 24%. For certain sectors, this increase is shocking and completely unworkable. The insurance costs in the arts, entertainment and recreational sectors have more than doubled. Unaffordable and unworkable, the dysfunction in the insurance market damages communities, jobs and local economies. The report also found that claim costs fell by 34% over the past decade, with the number of claims made falling by 47% during the same period. We can see the same pattern when we look at the Central Bank report on the motor insurance market published earlier this year which showed the same trends of claims falling but premiums increasing. That was before the new personal injury guidelines came into effect and awards were cut by 50%, with claims costs slashed for insurance companies.

In my view and that of my party, the insurance industry needs to be brought to heel. Premiums need to be reduced for motorists, businesses and all consumers and this needs to be done without delay. We must ensure that the reduced costs in claims are passed on, euro for euro, to consumers. I have no doubt that everybody in this House believes that is the way we need to proceed. There are ways to fix this.

In April, I introduced the Judicial Council (Amendment) Bill which would require the industry to report to the Central Bank on how it has or has not passed on these savings, euro for euro, to its customers. If it has not everybody would know about it and it would allow the Dáil to hold the industry to account and to put pressure on the insurance companies to do the right thing. Similar regulations were adopted in Britain last year in response to the reduction in whiplash awards. Insurance companies that operate here, such as Aviva, AXA, AIG, Allianz, Zurich and RSA are subject to these regulations in Britain and have to show that, pound for pound, the reduction in awards were passed on to their consumers. This has to be done in an audited way. I say to the Tánaiste that there should be no less oversight here.

The Government let the industry off the hook when it delayed my Bill which had passed Second Stage for nine months. That was an incorrect decision which was made for narrow party-political reasons and which, unfortunately, has served the interests of the industry and undermined the interests of consumers. Can the Tánaiste work with us? I urge him and the Government to reverse course and to stop delaying the Bill in question and provide the Dáil with a tool to hold this industry to account. The latter will ensure what we all want to see, namely, that the reduction in awards will be passed on to consumers without delay so that we can bring the costs involved to a more reasonable level?

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