Dáil debates

Wednesday, 5 October 2022

Personal Injuries Resolution Board Bill 2022: Second Stage

 

4:52 pm

Photo of Seán CanneySeán Canney (Galway East, Independent) | Oireachtas source

I am delighted to see Deputy Calleary here in his brief as Minister of State. I wish him well and I am delighted he is present to deal with such an important Bill for the country. I look forward to working with him on it and wish him the best of luck in his role.

When I was in the private sector, I engaged a lot with insurance and the construction industry. I saw claims come in and go out, and dealt with claims in the courts. The one thing I learned was that the day you went to court with a claim was the day you were losing, because the legal profession is an industry in itself when it comes to dealing with claims. We went to court on the basis that the claim was not right and was being manufactured or whatever. On two occasions, I went to court because I felt determined enough that we, as a company, needed to defend our honour and insurance record. Not every small business will go to the extreme of going to court and challenging a claim. That is a problem because businesses do not have the resources to do it or would prefer to do a deal and get on with things. The problem is that when people go to court and defend in a case, they will still not get the benefit of cheaper insurance because they have saved the insurance company money. They will just be another statistic for them to look at.

The Bill is a basis for good legislation, with a few exceptions. What we need to do is stop the gravy train for the legal profession. We need to make sure that whatever money is being spent on paying out insurance claims is going to somebody who has a genuine reason to be compensated. We do not want an industry around this to develop.

When I was in construction, I always found it baffling that there were multiple insurances covering the same risk. A builder had to take out public and employers' liability on a building while work was taking place. At the same time, the building contractor had to take out public and employers' liability on the same building. Every subcontractor had to have the same liability insurance in place, otherwise they would not be allowed into the site. A multitude of insurance premiums were being paid out to cover the same risk, which was a building and all of the activity within it.

At one stage, we tried to get umbrella insurance to cover everybody on a site for a client. The credit we received on our premium was so little that it was not worth changing the paperwork because the insurance company did not want a precedent to be set whereby fewer policies were needed to cover the risk. It is important that we realise that is going on and is costing our construction industry a fortune.

I am an active member of Belclare Community Council. Corofin Community Development Association and other community development associations across the country hold their breath when it is time to renew their insurance premiums because they do not know what it is going to be. A lot of small businesses are only trading because they have decided to do so for one more year. Given what businesses have been through with Covid, and what they are now going through with increased costs and all of that, it is important that when we put legislation place, it is effective and does something for people and not the insurance industry.

The Regional Group was cognisant of the fact that some people were putting in fraudulent claims. There were no consequences for those who were found to have said something fraudulent. That is being corrected, but the message needs to be driven home that we have to stop anybody who is even contemplating doing something like that in their tracks. We need a deterrent, rather than a penalty afterwards to stop people from doing such things.

There are two things that the Bill could improve. There is a fear on the part of business people, including Pat McDonagh of Supermacs, that by introducing mediation we will introduce further costs, delays and legal charges because legal people will want to sit at the table. If the Bill can make sure that does not happen, it is important that we do that. There is no point in having a process whereby there is mediation that is not binding. If there is mediation, it needs to be binding on the participants. That would be very important. It would mean that people go to mediation on the basis that they will have to accept the outcome. If they say they will not accept the outcome when they do not like it and can go some place else, we will then add another layer of costs to the process.

Another issue raised by AIR is the claims database. The claims database available at the moment is the property of Insurance Ireland, the umbrella organisation representing insurance companies in Ireland. We should consider having a claims database that is owned by the State and available to people in the industry who need it. Cases have been highlighted by AIR where insurance companies have been kept out of competition because there is somewhat of a closed shop. We have an opportunity and responsibility to make sure that whatever legislation is passed is effective. The Minister of State knows that the legislation we introduce to try to reduce the number of claims, make the claims process more efficient, ensure money gets to where it needs to go and reduce the high costs of claims does not always necessarily lead to reduced premiums. If we have an industry where people have a fair crack at competing, and know the rules of engagement and do not try to manipulate them for their own sake, we will have a more attractive market for other entrants to come in and offer insurance.

Certain cohorts in our society find it very difficult to get insurance. We also have to look at the idea of introducing national insurance, as we have for local authorities. It could cover people through State intervention to make sure they can do business and have insurance cover that will help them in any claim that might arise. At the end of the day, we have a plethora of different sized businesses in this country. A small operator with one machine to dig roads or whatever has to have the same level of cover as a large civil engineering contractor, in terms of the limit of liability he or she has. The terms and conditions have to be the same. We have to make sure that if a guy is digging across a road or boreen in County Galway or Mayo, his insurance costs are not so high that it is not worth his while doing that work and larger contractors have to be found to do such work.

We need to spread the cost to ensure there is a more efficient industry and make sure that the premiums that companies are paying make it viable for them to remain in business. I will examine the Bill. As my colleague said, we may table amendments but we will discuss that with the Minister of State's officials

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