Cathal Crowe (Clare, Fianna Fail) | Oireachtas source

This is a positive Bill. It is probably not the most exciting work we will do in Dáil Éireann this week but it is very important, particularly from a consumer point of view.

The Health Insurance (Amendment) Bill is somewhat akin to the Finance Bill or the Social Welfare Bill. It arrives in November or December each year. The measures in it are designed to support risk equalisation and sustain community rating in our health insurance market so that older people, whom the Minister of State, Deputy Butler, represents very well, and those with long-term illnesses can avail of the same health insurance cover as everyone else and are not discriminated against in favour of younger, healthier people in society.

The most crucial part of this Bill is its provision for the reduction in stamp duty levies on advanced health insurance contracts, which will decrease from 2021 to €406, representing a decrease of €43. Non-advanced health insurance contracts will decrease from 2021 to €122, a saving of €35. As a result of lower claims activity due to the past 18 months of Covid-19 and restricted use of hospital services, a surplus has built up in the risk equalisation fund. Consequently, the Minister of State and the Departments of Health and Finance are looking at the reduction in stamp duty to ensure health insurance contracts will benefit from that from 1 April 2022. That is good overall. It puts money back in people's pockets and ensures those who are most vulnerable continue to get the same level of public health insurance without having to dig deeper into their pockets.

The principle of risk equalisation is part of global insurance. We have had it for many years. It works quite well in health insurance. However, if I may go on a slight tangent, risk equalisation has become an absolute stinker in the area of flood cover. They are two different realms but it is all the world of insurance. The principle of risk equalisation might make a hell of a lot of sense when it applies to health when there might be an older person and a younger person or a person who is perfectly fit and healthy versus someone who has underlying illnesses. It makes sense in public health and the provision of private health cover but it does not make sense in the realm of flooding.

If we take any field or townland, the topography varies very much. There could be undulating land, hills, drumlins or parts near water drainage or even at sea level. In County Clare, 5,000 or 6,000 households struggle annually to get flood cover on their home insurance policies because of the risk equalisation principle. Every year, I have to write a letter on behalf of some of my neighbours. Using Dáil headed paper, I state that it is my belief, in all the years I have lived beside the persons in question, their houses have never flooded and, thus, I implore their insurance company to provide them with flood cover on their policy. I can rattle off the text because I write this letter maybe 50 or 60 times a year. It is insane. The insurance industry accepts a letter on Dáil headed paper that the person living in No. 95 does not experience flooding. Risk equalisation is bonkers. The home of the person who is denied flood cover year after year is about 60 ft above the maximum level of the River Shannon. That has to change too.

Risk equalisation is working very well as far as VHI and health insurance are concerned, and we are glad people will be reimbursed stamp duty, but it really does not work as far as flood cover is concerned.

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