Dáil debates

Tuesday, 2 November 2021

Saincheisteanna Tráthúla - Topical Issue Debate

Insurance Industry

10:25 pm

Photo of Jackie CahillJackie Cahill (Tipperary, Fianna Fail)
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Usually when we talk about insurance in this Chamber, it is in the context of the escalating cost. During questions to the Tánaiste earlier, I said that where the cost of injury claims comes down, the cost of insurance should come down correspondingly, and we had a discussion on that.

This matter, however, is about certain sectors being unable to get any insurance cover. We have seen this creep into the sporting activity sector in recent months, with water sport activities, activity parks and water parks failing to get insurance. One such business in Dromineer, in my county, had to close because of a lack of insurance. Now we have been told ice rinks for the winter period will not get insurance. We see an increasing number of sporting activities failing to get insurance cover, irrespective of the cost.

Now we see this stretching into the equestrian sector. Last weekend, two point-to-point events had to be cancelled because of a lack of insurance. As for the equestrian and hunting sectors, we have 100 packs in this country. We had only one insurance provider in this area but it has now withdrawn. If insurance for hunting packs comes to an end, with different packs at different stages, those hunts will not be able to engage in any activity. Consequently, the organisers of point-to-point events, which operate under the same umbrella, will not be able to operate either. Aside from the recreational aspect of these sports, they are hugely important businesses. They are the cornerstone of our national hunt industry and extremely important financially and to rural Ireland.

We have had the disruption of Covid, which put national hunt breeding under extreme pressure, and we had point-to-point racing cancelled for a number of months. Thankfully, we got the latter resumed, but a second winter of disruption to our activities would be extremely damaging economically. I am talking about the shop window where our young horses are shown and able to be sold, whether to buyers here at home or to the UK or further afield. A second winter of disruption would impact on the sales of younger horses all through the year. It is imperative therefore that the Government comes up with a solution to this crisis - and a crisis it is. As I said, we have often been in this Chamber arguing about the cost of insurance, but this is a completely different aspect of various sectors of sporting activity being unable to activate insurance at any price.

A substantial claim was awarded on the hunting fields in recent months, and that is the reason being put forward for the insurer leaving the market. That accident happened in my county. The rider involved was severely injured and I understand a substantial payout was received. This is a man with a young family and he will have a lot of costs for the rest of his life. We cannot, however, have a situation in which vital sectors, whether a business involving water activities or any other recreational activity, will be left without insurance cover. As I said, the equestrian industry is massively important to all parts of the country. We just have to come up with a solution to this. We cannot just have insurance companies cherry-picking what they will insure. I am not talking about insurance at any cost because, obviously, no business can afford that. Surely, though, we could have a regulator that would ensure reasonable costs in respect of claims paid out over a number of years and ensure that insurance companies, in order to be allowed to operate in this country, would be forced to give quotes at reasonable costs to all sectors.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I acknowledge the issue raised by Deputy Cahill regarding insurance cover for rural pursuits. Ireland's unique natural amenities not only play a key role from an economic perspective, more importantly, they also serve to enrich the quality of life in communities across the country. Accordingly, I do not take the challenges of both the accessibility and affordability of insurance for outdoor pursuits lightly. The case the Deputy outlines is really about lack of access. The issue of affordability has not featured in the debate because this is an issue of availability of insurance.

It is important I make the point that there is no single policy or legislative initiative which the Government can take to persuade insurers to provide cover for any particular sector or industry.

Moreover, neither the Government nor the Central Bank can interfere in the provision or pricing of insurance products, nor do we have the power to direct insurance companies to provide cover to specific businesses or individuals. This legal position is reinforced by the EU solvency directive framework, which is directly on this issue. The only situation in Ireland that I can think of where people have a legal obligation to get insurance is motor insurance in the private motor sector and in those cases, there is a process which refers to the declined cases that have to be dealt with. A person must be given a quote, albeit the price will depend on the risk involved. That is the only element in Irish society where the industry can be forced to provide insurance, and that is in the motor insurance area.

Notwithstanding this, we continue to prioritise insurance reform and work is progressing right across Departments on the timely implementation of all the actions outlined in the action plan for insurance reform. Deputies may be aware that the first action plan implementation report was published in July and it shows that significant progress has been made, with 34 of the 66 actions contained therein now completed, with work also under way on the remainder.

As part of my intensive stakeholder engagement on the reform agenda, I have met many groups to discuss the difficulties in obtaining insurance. Accordingly, I am aware of the exit of a number of UK leisure insurers from the Irish market in recent years. This may affect the areas referred to by the Deputy, be it ice rinks or some water sports. The Deputy also mentioned hunting and point-to-point races, which are a separate issue. The new personal injuries guidelines were a key element of our action plan that were delivered ahead of schedule. I believe that when fully implemented across all of the cases encompassed by them, it will lead to a reduction in the cost of claims. In its own right, this will help to attract companies back into the sector to provide policies, where they have been slow to do so at the moment. Early indications are that reductions as a result of this have resulted in a 40% reduction in the cost of those claims, which is highly significant.

It is disappointing to hear that difficulties in obtaining insurance cover is affecting rural pursuits. It was brought to my personal attention last week with one of the major brokers in the area, who mentioned it to the Department a few days earlier. The issue has been brought to my attention only in recent days. I assure the House that the Minister for Finance, Deputy Donohoe, and I will continue to hold insurers to account on previous commitments they have made in this area. A key element will be bringing in the law of occupiers' liability and duty of care. The Minister for Justice is advancing this and it will come before the House shortly.

I recognise the issues and I want to listen further to the particular cases the Deputy has referred to. I will comment on those during my next opportunity in a few moments.

10:35 pm

Photo of Jackie CahillJackie Cahill (Tipperary, Fianna Fail)
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While I appreciate the Minister of State's answer, we do not have weeks to sort out this issue. It needs to be sorted out immediately. A number of years ago there was a similar issue with access to rural Ireland, whereby landowners were extremely concerned about their liability when people were using their land for recreational purposes. There was a satisfactory solution for that, namely, liability was taken away from the landowner. We need something similar in this case. I suggest that the notion of a waiver by participants in activities is examined by the Government and if a person signs the waiver of any liability, that this would be taken on board by the insurance company to absolve them of any liability to a claim when an adult is participating in an activity. We should see if this idea can be advanced immediately, that is, if a participant signs a waiver, this would take away any potential liability that may be incurred.

Businesses are closing because of lack of insurance but now this hugely important industry for rural Ireland is under immediate threat. We must get a solution to this. I accept the Minister of State's point that we cannot force insurance companies to quote but we must build an environment immediately that will make it economically attractive for insurance companies to quote at a reasonable cost. We cannot just stand idly by and allow a cornerstone industry in rural Ireland to collapse for the lack of insurance cover. We will be failing in our responsibilities as legislators in the Dáil if we allow this to happen. We have a responsibility to these industries, whether it is water activities or other recreational activities and sports that are now failing to get insurance, or the equestrian centres that are a huge cornerstone industry in every county in the country and all across rural Ireland. A huge number of people are employed in this industry, be it in the livery for horses, breeding horses or training horses. This is a hugely important industry and we cannot abdicate our responsibility in this regard. We are legislators and we must ensure that insurance cover is available to all sectors to allow them to continue their businesses.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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I thank Deputy Cahill for highlighting this acute issue that has only come to our attention in the last number of weeks. On this exact point, I received an email just yesterday from one of the county farmers' hunts expressing their anger and frustration at what has happened in this area. In the email I received, they highlighted that the loss of Ireland's hunting community would have dire consequences for our sport horse industry and point-to-point racing and that the lifeblood of our racing industry would be immediately devastated. I understand the seriousness and that it is not just an issue of recreational activities. As part of the core industry it affects rural Ireland.

I will be meeting the Alliance for Insurance Reform this week. They have established a list of areas where there are particular problems. I want to go through these on a case-by-case basis in relation to the different industries, some of which we have touched on here today, including play centres and outdoor play areas, as well as rural pursuits. We will talk to brokers to see where they can work collectively as groups. Definitely, Deputy Cahill has mentioned what is now a pinch point. I also will meet Insurance Ireland and the insurance companies this month. I will ask each of them to see how it can help collectively in this area.

Reference was made to strengthening the waiver system. I agree completely with Deputy in this regard. This will tie into the duty of care. That system is in place in many places where a person will enter and sign a form to say that he or she is entering at his or her own risk and understands the situation. Unfortunately, in the past when the cases have gone to court the judges have taken a lenient approach and often sided with the person who had the injury, notwithstanding that the person had signed a form, because he or she said that there were some issues in the area they had not known about when they signed the form. The strengthening of a waiver and making it legally binding is definitely to be included in the forthcoming legislation from the Minister for Justice.

The Dáil adjourned at at 9.57 p.m. until 9.12 a.m on Wednesday, 3 November 2021.