Helen McEntee (Meath East, Fine Gael) | Oireachtas source

I thank the Acting Chair for the opportunity to address the House on the actions my Department has taken, as well as my forthcoming plans, in respect of insurance reform. Insurance reform is a key priority for this Government, as we clearly heard from the Minister of State. It is reflected in the programme for Government, the Government’s action plan for insurance reform, and in my justice plan 2022. This is a whole-of-government effort. My Department has responsibility or part responsibility for 34 of the 66 actions contained in the action plan.

I am pleased to inform the House that of those 34 actions, 26 are now complete. These include important reforms such as the introduction of the personal injuries guidelines, the enactment of the Criminal Justice (Perjury and Related Offences) Act 2021 and the establishment of the insurance fraud co-ordination office, opened by An Garda Síochána in July last year. Last month, I received Government approval to reform duty-of-care legislation, a key insurance reform measure and an important part of the Government's overall action plan. I propose to amend a number of sections of the Occupiers’ Liability Act 1995 in line with the Government’s policy objectives of restricting the liability of occupiers. I believe these proposals strike the correct balance between ensuring businesses, community groups and organisers of events will fulfil their duty-of-care responsibility while acknowledging the importance of personal responsibility on the part of visitors, recreational users and trespassers.

The proposed amendments, which build on a review paper prepared by my Department in February 2021 and subsequently published, contain four key developments. They will insert into primary law a number of recent court decisions that rebalance the duty of care owed by occupiers to visitors and recreational users; change the standard of care such that when the occupier of a property has acted with reckless disregard to a visitor, the standard of reckless disregard rather than that of reasonable grounds should apply in respect of any consideration of liability; limit the circumstances in which a court can impose a liability on the occupier for a premises where a person has entered that premises for the purpose of committing an offence; and allow for a broader range of scenarios where it can be shown a visitor has voluntarily assumed a risk resulting in harm. The Office of the Parliamentary Counsel, working with my Department, is proceeding to draft the proposed legislation, which will be placed before the Oireachtas for enactment as part of the upcoming courts and civil law (miscellaneous provisions) Bill 2022.

The Judicial Council personal injuries guidelines, which I referred to earlier, came into effect in April 2021. They were adopted to promote consistency and fairness in the awards of damages in personal injury cases. The new guidelines replaced the book of quantum and have materially reduced the award levels for many categories of common injuries, particularly soft-tissue injuries. This represents a significant step in meeting our commitment to making insurance more affordable for consumers, businesses and community groups. One of my Department’s actions in the Action Plan for Insurance Reform was to report on the early impact of the guidelines by the end of 2021. We sought data to complete this action from relevant stakeholders, namely, the Central Bank, the Courts Service, the Personal Injuries Assessment Board, PIAB, and the insurance sector. PIAB provided data indicating award levels had at that time reduced by around 40% since the introduction of the guidelines, while Insurance Ireland indicated its members had experienced reductions in award levels in line with PIAB figures, again at about 40%. It proved too early, however, to gauge the full impact of the guidelines, given concrete data from the national claims information database were not available and cases at that point were not coming through the courts under the guidelines.

Notwithstanding the challenges in accessing relevant timely data, I presented a report on the initial effect of the guidelines to the subgroup on insurance reform at its meeting in February. The report was published in March as an appendix to the second implementation report on the Action Plan for Insurance Reform. Furthermore, I welcomed the publication of the report on personal injuries award values by PIAB in April, which showed awards for personal injuries had dropped by 42% year on year between April and December of last year. In addition, average general damages awards had fallen from €21,850 to €11,583, or by almost half.

In that context, the guidelines have had a clear and significant initial impact since their introduction, although many older legacy claims are still being assessed under the old book of quantum, meaning the full impact may take some time to be seen. My Department will, of course, provide whatever relevant information it holds to any further assessment of the impact of the guidelines. It is important to stress that the success of the guidelines will be dependent on buy-in from all stakeholders, including insurers, businesses and community groups. If they are to succeed, it will be vital for stakeholders to ensure the award levels set out are adhered to irrespective of how the claims are settled. A level of certainty regarding award levels will, I believe, lead to greater consistency in insurance premiums. The Government will closely examine the impact of reduced awards under the guidelines to ensure these reductions are reflected in reduced premiums for customers. Under the Action Plan on Insurance Reform, my Department has been tasked with ascertaining and setting out the measures necessary to implement pre-action protocols for personal injury cases and is engaging with the Attorney General on the matter.

The discount rate is the rate used by the courts to determine the size of an award necessary to compensate a person for damages in respect of future financial loss, typically in personal injury cases with serious long-term implications for the person concerned. Following a public consultation and an analysis of the submissions received, my officials submitted a number of options to me in respect of the manner in which the discount rate should be determined. Arising from that report, I have decided to address the issue by establishing an expert group to provide advice to me on an appropriate discount rate. On receipt of its recommendations, it is my intention to use my power as Minister, under section 24 of the Civil Liability and Courts Act, to set the discount rate. Work is under way on establishing the expert group and I look forward to receiving its advice in due course.

My Department has significantly increased resourcing to the Garda National Economic Crime Bureau, GNECB. This saw the number of staff increase from 95 at the end of 2020 to a total of 127 at the end of 2021, allowing for the opening of the insurance fraud co-ordination office last July. The establishment of this office will improve co-operation and co-ordination with the insurance industry, bring consistency to the handling and investigation of insurance fraud referrals from the insurance industry and improve on subsequent referrals to the Director of Public Prosecutions, DPP, for prosecution. The GNECB has proactively shared its guidelines on investigating insurance fraud with all divisions on the internal Garda portal and is also providing training and support to all Garda divisions on how to investigate fraud. It has put in place reporting mechanisms between An Garda Síochána and the insurance industry and drafted memorandums of understanding in association with Insurance Ireland and the Alliance for Insurance Reform which are awaiting formal sign-off by An Garda Síochána and once approved will be rolled out.

A new insurance claim fraud category has been included on the Garda PULSE system since November 2018 to enable the production of statistics on fraudulent claims, something that was not really the case previously. However, a large degree of manual examination of cases was still required by Garda analysts to extract suspected bogus insurance claims cases specifically, given the insurance fraud category on the PULSE system captures a broader range of insurance-related cases. The establishment of the insurance fraud co-ordination office and the implementation of procedures in the memorandums of understanding with the insurance industry will improve referrals and the collation, classification and veracity of the data. It will ensure the central collation of all complaints of insurance fraud directly from insurance companies, as well as the assessment, classification and logging of all cases on PULSE for statistical purposes, before routing them to the relevant divisional resources countrywide for timely investigation.

The Criminal Justice (Perjury and Related Offences) Act 2021 provides a clear, statutory definition of perjury and should enable the offence and related offences to be more easily prosecuted before the courts. The Act establishes a statutory criminal offence for perjury. It provides for statutory perjury-related offences including false statements under oath, false statutory declarations and false declarations, and for penalties of up to 12 months for conviction on a summary offence and up to ten years for conviction on indictment. It will also have a significant deterrent effect on those who might consider making false or fraudulent claims and sends a clear message to people who would abuse court time in this manner. Having examined changes to reduce insurance fraud, including penalties for insurance fraud in consultation with relevant agencies, my Department is of the view that no further legislative penalties are required at this time although, as with anything, we will keep that under review. Enforcement as opposed to additional penalties is what is required to ensure the current legislative provisions will be utilised as intended.

Overall, I am pleased to see the progress the Government has made in implementing the ambitious Action Plan for Insurance Reform since its publication in December 2020. I am also delighted to be able to report significant progress within my Department on relevant reform measures contained both in the action plan and in my justice plan for 2022. I acknowledge the significant work of my colleagues, the Ministers of State, Deputies Fleming and Troy, the Tánaiste, the Minister for Finance and advocates who have been working in this area, not least the Alliance for Insurance Reform.

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