Dáil debates

Thursday, 28 February 2019

Ceisteanna - Questions - Ceisteanna ar Sonraíodh Uain Dóibh - Priority Questions

Insurance Costs

11:40 am

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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3. To ask the Minister for Finance the priority measures he plans to implement in the coming months to address the cost of public liability and employer liability insurance; and if he will make a statement on the matter. [10146/19]

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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I assume that the Minister of State, Deputy D'Arcy, will take this question, which relates to insurance. It has been two years since the cost of insurance working group issued its report on motor insurance and a year since the report on employer liability and public liability insurance. There is a growing crisis in the area of business insurance. I will give an example when I ask my supplementary questions. I want the Minister of State to update the House on the key reforms that are needed to bring about more competitively priced insurance.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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I thank the Deputy. The cost of insurance working group project culminated in the publication in January 2018 of the report on the cost of employer and public liability insurance. The report makes 15 recommendations with 29 associated actions detailed in the plan. The most recent progress update was published last November and shows that 18 of the 19 action points arising up to end of the third quarter of 2018 have been completed. It is envisaged that the next quarterly progress report will issue shortly. The vast majority of the total of 26 action points due for completion during 2018 overall have been carried out. Many of the recommendations of the report on the cost of motor insurance also applied to the area of employer and public liability.

I wish to highlight some steps that have been taken. Sections 8 and 14 of the Civil Liability and Courts Act 2004 have been amended to ensure defendants are appropriately notified of a claim submitted against their policy and to make it easier for businesses and insurers to challenge cases where fraud or exaggeration, respectively, is suspected. A protocol has been put in place between the Garda and Insurance Ireland in respect of the reporting of suspected fraudulent claims. The Personal Injuries Assessment Board (Amendment)(No. 2) Bill 2018 has been enacted. The Central Bank (National Claims Information Database) Act 2018 has been passed. I thank all the Deputies and Senators in both Houses who facilitated this legislation.

The Law Reform Commission, LRC, has been asked to produce a report on these Houses' ability to cap the level of awards. That has been agreed to. Senator Anthony Lawlor will bring legislation to the Seanad in the next couple of weeks that will give this House and the Seanad this authority. Moreover, the establishment of an insurance fraud investigation unit within the Garda National Economic Crime Bureau, GNECB, is being considered by the Garda Commissioner, as opposed to a stand-alone insurance unit external to the GNECB but within its parameters.

11:50 am

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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I thank the Minister of State for his reply. I will give the example of a play centre in Cork. I know what I am about to say be a fact - there is no exaggeration. The play centre has made no claims in recent years. In 2016, its insurance was €3,500. In 2017, it was €5,500. In 2018, it was €10,000. Its renewal will happen in March and the quote it has received is for €18,500. That will more than likely put the centre out of business. As the Minister of State well knows, this story is repeated throughout the country. We have a crisis in employer liability and public liability insurance costs for businesses. Where are we with the CSO's collection of data on premium pricing in respect of business insurance? Where are we in terms of dealing with awards? In practical terms, where are we on the question of fraud?

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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I have met a large number of those involved in play centres. The issue is the level of awards. Claims are being presented that, to me, are spurious. If the incidents involved happened in the Deputy's brother's or sister's house, the claims would not be made. A major issue for business insurance is that if an accident happens or somebody gets a bump, scratch or knock of any nature, a claim is presented against the business. That is wrong.

The level of awards is a significant issue. I did not anticipate the Judicial Council Bill getting stuck behind the Judicial Appointments Commission Bill in the Seanad. The Minister for Justice and Equality, Deputy Flanagan, has put 70 plus hours in on that front. I have spoken to him. He will restart the Judicial Council Bill in the Seanad next month, which is a positive development.

Photo of Seán Ó FearghaílSeán Ó Fearghaíl (Kildare South, Ceann Comhairle)
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I thank the Minister of State.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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I apologise for going over time, but this is a crucial point. I ask all Members of both Houses to facilitate the passage of this legislation because it will allow the new guidelines to revise the book of quantum.

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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From a Fianna Fáil perspective, there is no issue with political support being provided. If the Government needs time in the Seanad, it should ask us. I will talk to our colleagues about providing our time in the Seanad to deal with the Judicial Council Bill.

It is two years since the first report was issued but, on the question of a fraud unit within the Garda, the Minister of State is saying that it is being considered. It was essentially recommended two years ago, yet there is no firm update as to whether it will happen. People want to know if it will happen and, if so, when. We lost a great deal of time in the argument about who would fund it, yet we still do not know whether it will happen.

The Minister of State is blaming the issue of awards completely. It forms part of the story, but I do not accept that a play centre's insurance bill increasing from €3,500 in 2016 to €18,500 in 2019 is completely down to awards. The data do not bear that out. If, however, the Minister of State attributes the main reason for premiums increasing to awards, where are we in terms of dealing with them?

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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It is the main reason. It is bigger than all of the other reasons combined. There is no question about that. I ask all parties to facilitate the passage of the Bill in the same way they facilitated the passage of the Insurance (Amendment) Act 2018 and the Central Bank (National Claims Information Database) Act 2018. I have always been generous in my praise for everyone who facilitated those, as they have been very helpful.

Regarding the Garda unit, it is not for me to tell the Commissioner how to allocate his resources. I have put to him the request that was put to me strongly by the finance committee regarding the establishment of an independent Garda insurance fraud unit. That will not be the case. Rather, the Commissioner has considered putting in place a section within the national crime bureau that will do exactly the same work. I am fine with that so long as the necessary work is done. I was critical of the Garda Síochána-----

Photo of Michael McGrathMichael McGrath (Cork South Central, Fianna Fail)
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It has not been committed to.

Photo of Michael D'ArcyMichael D'Arcy (Wexford, Fine Gael)
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No, but he is considering establishing it quickly. I was critical of the Garda Síochána. In 2017, 400 cases of insurance fraud presented to it. None of them was prosecuted. That is not good enough.