Paul Lawless (Mayo, Aontú)

The cost of insurance is crippling to so many young people. This Government has already priced young people out of the housing market, and out of the opportunity to have their own home. Now the Government is pricing them off the road. The Government is taking away their independence. That is what is happening. Over recent years, premiums have risen by on average by almost 10%. The major issues are the lack of competition; inflated claims and the culture around claims; and legal fees. Young motorists are not only paying for their own risk, but they are also paying for systematic failures, historical legal costs and an out-of-control culture when it comes to claims. We need to focus on the solutions. We need to focus on reforming the claims culture and the awards associated with claims. We need to increase the competition in the market.

The European Commission recently investigated the sector in Ireland and found it is highly concentrated and behaving like an oligopoly. There is so little competition that it is driving up prices for consumers. It is consumers and motorists who are paying the price.

I want to raise a very important issue, namely, the litigation bonanza that is happening, particularly in the motor insurance sector. With regard to fees, 70% of the payout goes to the legal profession, that is, 70% of the total cost of a claim. For example, the average cost of legal fees is €23,000 for a claim of €46,000. That is incredible, in particular when the average claim through the personal injuries board is €700. I am asking the Minister of State to do a number of things. When it comes to litigation, Germany caps the legal fees associated with this, and the same should be considered here. I have no doubt it would crystallise the minds of those in the legal profession to perhaps engage in a pre-court settlement.

I also want to raise the issue of the personal injuries board. The vast majority of claims are being settled by the court route, which is still dominant. The IRB was set up to assist in reducing legal fees in the insurance sector but it has not worked. We need to review it. In fact, we should consider having more claims go through the IRB in a mandatory fashion and make its cases binding. We cannot have a situation where the IRB is twiddling its thumbs while the vast majority of cases are going to court, and 70% of the cost is tied up in legal fees. It is a major issue and must be addressed.

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