Seanad debates
Tuesday, 10 June 2025
Insurance Reform: Motion
2:00 am
Mark Daly (Fianna Fail)
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The combined speeches of the proposer and seconder will not exceed 16 minutes and all other Senators will have six minutes each. I call on Senator Linda Nelson Murray to move the motion.
Linda Nelson Murray (Fine Gael)
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I move:
That Seanad Éireann:
acknowledges: - the publication, in 2020, of an Action Plan For Insurance Reform;
- that there have been four Action Plan Implementation Reports to date;
- the establishment of the Office to Promote Competition in the Insurance Market;
- the introduction of new personal injuries guidelines in April 2021, which set reduced levels for personal injury compensation and changed the amounts of General Damages to be awarded by the courts and by the Injuries Resolution Board;
- the reform of the Injuries Resolution Board to include the provision of mediation as a means of resolving a claim in employer liability claims; giving the Injuries Resolution Board a role in providing information analysis and awareness raising; a requirement for proof of identity (PPS Number) and confirmation that the medical report provided at the time of a claim contains details of the injuries sustained in the incident which gave rise to the claim and the disclosure of information to An Garda Síochána to reduce fraud;
- the making, in 2021, of perjury as a statutory offence for the first time, to help address insurance fraud;
- the re-balancing of the Duty of Care with new legislation enacted in July 2023;
- the strengthening of the Solicitors Advertising Regulations 2019 with the Legal Services Regulatory Authority regulations which came into effect in December 2020;
- that there has been an increase in coordination and cooperation between An Garda Síochána and the insurance industry in relation to fraud;
- the establishment of an Insurance Fraud Coordination Office within An Garda Síochána, to allow for uniformity in the reporting and processing of cases of suspected fraud, as well as offering support to Divisional-level investigations and providing accurate statistics on the number and trends of cases;
- the enhancement of the National Claims Information Database; notes the Government’s efforts to promote competition in the Irish insurance market: - by encouraging greater competition between existing insurers, including through expanding product offering;
- by encouraging new entrants to enter the insurance market, be they new domestic companies, companies ‘passporting’ in from EU/EEA member States, or companies
from third countries outside the EU/EEA;
- by considering new initiatives to assist in advancing the above objectives, having regard to the EU Directives pertaining to insurance; EU state aid rules; EU and national competition law; and the statutory independence of State bodies; further notes: - the recent Public Consultation by the Department of Finance on a new Action Plan for Insurance Reform;
- the launch in May 2024 of a new system which allows members of An Garda Síochána to quickly and easily identify uninsured vehicles;
- the significant reduction in the number of uninsured vehicles over the last 12 months; calls for further action on insurance reform including: - greater transparency on how insurance premiums are calculated to ensure the benefits of Government reforms are passed on to consumers and businesses;
- the extension of the review of the personal injuries guidelines to every seven years to avoid excessive increases;
- the introduction of tougher penalties on those who commit insurance fraud;
- the encouragement of more competition from international insurance companies;
- increased affordability and availability of insurance;
- the encouragement of faster release of data from the National Claims Information Database to improve transparency;
- the development of new guidelines on rates and fees on all forms of civil litigation and the taking of further steps to resolve cases outside of court;
- the maintenance of the Cabinet sub-committee on insurance reform;
- the prioritisation of legislating for the ‘Right to be Forgotten’ for cancer survivors;
- the strengthening of the Injuries Resolution Board to support the resolution of cases outside of court;
- the mitigation of the impact of climate change on insurance, including extreme weather risks and the insurance protection gap;
- the enhancement of Ireland’s position as a leading insurance hub in Europe and internationally;
- the promotion of Insurtech innovation and digitalisation.
Mark Daly (Fianna Fail)
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For the benefit of Members, the Minister can contribute at any time he indicates. Is Senator Scahill seconding the motion?
Linda Nelson Murray (Fine Gael)
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The increase in the personal injury guidelines, as recommended by the Judicial Council, of 16.7% is excessive. As I was preparing for this over the past couple of days, I reflected on the first time I spoke about horrendous insurance difficulties facing businesses, which was on 24 January 2019. There I was, sitting in a ball pool in my soft-play centre, full of hope and enthusiasm that we could do all we could when it came to insurance reform to save businesses like mine. An article in the Irish Examiner reads: "Linda Murray has vowed to go down fighting after failing to get insurance renewed on her own play centre in County Meath, where premiums have spiralled from €2,500 to €16,500 in just five years". It was my insurance that had gone from €2,500 to €16,500. The article continues: "With two claims pending, she has been refused cover renewal and may now have to close [her business] in Navan, with the loss of 12 jobs". Thankfully, that did not happen, but it almost did. The only reason my business is still open is that like-minded businesses in the leisure sector came together to form a group called Play, Activity and Leisure Ireland, PALI.In that group, we got a group insurance scheme and so, in a sense, we all support each other. Getting that scheme set up and continuing it has required a huge amount of work both from when I was involved and by the current team in PALI. Today, those people are in an insurance meeting trying to get the next scheme going. They should not have to do it but without it, we would not all be open; it is as simple as that.
Today's motion recognises the work the Government has done. The 2020 action plan for insurance reform delivered significant progress and only two weeks ago, stakeholders had a chance to give input into another examination of insurance reform. I believe there were approximately 60 submissions, which is fantastic. Real-life examples are important when discussing an issue such as insurance. Today, as Members have probably seen, Chill Insurance has released a car insurance index showing that people in counties like Longford pay on average €1,042 for car insurance. Those in my county of Meath pay an average of €785 for car insurance. I have heard that a publican in Cork recently had his premium increase from €5,500 to €6,300, an increase of approximately 14.5%. A publican in Donegal had a premium increase from €6,000 to €7,500, or 25%. In just one year, a restaurant in the south east saw its insurance premium surge by 23% despite having no claims in recent years. There were no incidents and no payouts. There was no justification, so why the hike? Over the past two years, a Cork restaurant's insurance premium has jumped by 30% without a single claim on its record. This is indefensible and exposes the broken nature of our insurance market.
The circular economy is going to become increasingly important as our carbon emissions come under increased scrutiny in the years ahead. Recycle IT decided to compare what it was paying in Ireland with what its counterpart in the UK was paying. Guess what? Granted, Recycle IT's turnover is three times higher than the UK organisation, but its premium is 17 times higher, with one paying €51,000 and the other paying £2,100. A tool-lending library here in Ireland, a great initiative, has managed to secure a policy that represents 75% of its budget, which for many start-ups could mean imminent failure before they even begin.
I will focus on a few points, and the Minister of State knows what I am going to talk about first - the legislation surrounding the personal injury guidelines. He and I have spoken about this and it is something I cannot give up on. I feel that he understands what I am saying. Personal injuries sustained by visitors to businesses and public spaces between 2019 and 2023 have seen a 40% reduction in claim volumes since we introduced these guidelines. In addition, claims in cafés, hotels and restaurants more than halved while shops and stores saw a 44% decrease and sports and athletic areas experienced a 38% reduction. Now, the Minister for justice is considering increasing awards by 16.7% before we have even seen the impact of the first reduction. The Minister for justice has received a recommendation to increase these awards, and this has come from the Judicial Council. Would we ask the Judicial Council to come up with sentences for murder or theft? If there is a separation of powers there, why is there not a separation of powers here?
I want to read an excerpt from the draft guidelines presented to the Minister for justice.
In carrying out its review, the Committee had regard to [two matters in particular] ... The first is the fact that in the three years since the adoption of the original Guidelines, significant global and national inflation has occurred. The second is the jurisprudence of the Superior Courts that emerged in the period regarding the proper approach to the assessment of damages in multiple injuries cases.
The Committee did not find it possible to carry out any meaningful analysis of the quantum of court awards given under the Guidelines that might inform this review. This is because the inevitable delay between the commencement of proceedings to which the then new Guidelines applied and their trial has meant few award decisions have been reached - certainly not enough to be statistically significant.
If this is the case, why are we not waiting for meaningful data? The report also states that the board decided to modify the guidelines in order to reflect the HIPC rate applicable at the time of its consideration of the draft amendments to the guidelines. I am not an expert on inflation, but I believe it is approximately 1.9%.
On this, I ask the Minister of State to do the following: please, change the review of the personal injury guidelines to seven years, let us wait for the data from cases through the court system and settlements out of court, and let us analyse it properly. Do not let the Judicial Council decide on awards. Section 90 requires looking at awards outside the State. The Judicial Council's 2020 report comparison with England no longer holds as there are much lower values for soft tissue injury there. For example, when England reviewed its tariff on soft tissue injury, it undertook a process calling for evidence submission. It got experts and real-life evidence. We need a separate independent commission made up of the Injuries Resolution Board, stakeholders and policyholders, and - real information. If it is not too late, I call on the Minister of State to negotiate those increases. Let us not let down all the those in businesses, groups and sports clubs around the country, many of whom are watching this debate right now. The Minister of State must try to fix this for everyone's sake.
The NCID liability report found in 2023 that the average legal costs were less than €1,000 for cases finalised at the Injuries Resolution Board but over €23,000 once they entered litigation while awards for claimants were the same in either channel at €23,000. The NCID report also shows that cases that go to litigation take almost six years to settle whereas it takes only two years through the Injuries Resolution Board. Therefore, it is disappointing to note that the volume of cases going through litigation has actually increased by 17% between 2019 and 2023. The Injuries Resolution Board is the fastest and most cost-effective method for resolving claims. The Minister of State has been very much involved in this. It is fantastic. The Government needs to make every effort to ensure claims are progressed and settled through this channel.
Therefore, I ask for a full review of the legislation underpinning the Injuries Resolution Board to be carried out to examine how it can be further strengthened. The timeframes for settling cases through the Injuries Resolution Board should be reduced, with increased resources and staff provided where necessary. There needs to be a major public awareness campaign to make people aware that the Injuries Resolution Board is the fastest and most effective avenue to resolve their claims. The board needs access to information on all settlements to allow it to carry out accurate reporting on adherence to the personal injury guidelines and, in particular, to closely monitor and compare the difference in award amounts settled through litigation. We need to explore the feasibility of moving the insurance link framework to the Injuries Resolution Board.
Legal fees can often exceed the injuries awards paid out, as reflected constantly in newspaper articles. Consideration should be given to whether fee scales can be implemented, as has happened in other jurisdictions. Why would we not ensure legal fees in personal injuries are more transparent so we could know exactly where the fees came from? Can we just restrict aggressive advertising for high claim awards in social media? TikTok, Instagram and Facebook have lots of such ads. The legal profession should not be allowed to ask the claimant to seek a medical report unless this has been recommended by a medical professional.
The issue of transparency is the killer for most people. Through all forms of social media, we know that transparency in everything is vital and this is just as true for insurance. Premiums are given without fully explaining the key contributions towards that premium, including wages, footfall, risks, claims and price increases. It is a failure for policyholders that premiums provided to them are not fully transparent. There must be greater transparency as to why the benefits of the reforms to date have not been passed on. Insurance companies should be required to clearly outline the rationale for year-on-year premium increases where there have been no claims on the policy.
I could go on and on on this subject; I could take the full 16 minutes without any problem. This is the reason I came into politics. It started with me trying to save my business and businesses like mine. That moved on to trying to help sports clubs, playgrounds, community facilities and motorists - everything that involved insurance. On its fun day last year, my GAA club of Navan O'Mahony's could not put a bouncy castle on site because it could not get insurance. It could not put in anything inflatable. Parades and festivals have stopped because of insurance. We do not want to see insurance for our cars, cafés, community groups, charities, football clubs and golf clubs rise. I guarantee that if we agree to the 16.7% increase as outlined in the personal injury guidelines, that is exactly what will happen. It will also impede the work of the Injuries Resolution Board even though the previous Government did all it could to get claims processed through it. Legal costs are already a substantial problem and will only increase if this proposal is adopted. Right now, businesses are faced with a myriad of increased costs, which we hear about every day, and we simply cannot add fuel to the fire by doing something that will drive premiums up.
As I mentioned previously in this House, I am one of those people who has been impacted. I absolutely know what is going on. Over the past few years, we have witnessed an excellent programme of insurance reform delivered by the previous Government. I strongly urge the Minister of State to invest the time in keeping this up. Our programme for Government committed to further action to drive down insurance costs impacting households, motorists and businesses. This is now our first early test. I trust the Minister of State not to let his local GAA club, local café, local crèche and local parades down. I ask him to please do all he can.
Gareth Scahill (Fine Gael)
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I support what my colleague Linda Nelson Murray has said. I also acknowledge the 16.7% increase in the personal injury claims guidelines is excessive. Today I want to spotlight a particular area, however, where the insurance system currently presents an unforeseen hurdle which directly impacts a vital national priority: encouraging our talented diaspora to return home.
Ireland is a nation built on its people and our diaspora is a source of immense pride and potential. We are actively reaching out to our skilled professionals living abroad, particularly those in sectors where we currently face a skills gap. A prime example of this is our health sector. We are acutely aware of the need for experienced and dedicated healthcare professionals. To this end, we have introduced an international recruitment relocation package. This generous initiative aims to significantly lessen the financial burden on returning healthcare workers by covering expenses such as flights, initial accommodation and, crucially, recognising their hard-earned qualifications from abroad. This is testament to our dedication to making their return as smooth and welcoming as possible. However, a significant challenge for them remains.
When these highly skilled individuals, who have often built lives and careers abroad, seek to integrate back into Irish society, they encounter a frustrating disconnect in our insurance landscape. Despite having years of claim-free driving history or comprehensive health insurance policies from reputable providers in their previous countries of residence, these policies are often not recognised by Irish insurers for the purpose of establishing a history or reducing premiums. Think of a doctor or nurse who has spent a decade serving a community in Canada and who has a flawless driving record and continuous health insurance cover. Upon returning to Ireland, they are often treated as if they have no insurance history. They face exorbitant premiums for car insurance and potentially higher initial costs for health insurance. This is not just an inconvenience; it is a financial disincentive. It undermines the very spirit of the relocation package and can often swallow up far in excess of what the relocation package can do. This is an anomaly we need to address. We are asking our diaspora to bring their valuable skills, global experience and their families back to Ireland, yet we are failing to recognise their established insurance histories. It is akin to inviting someone to a race but making them start from the very back regardless of their past performance.
I also acknowledge we need to introduce, and I know this is a focus for the Government, greater competition and choice in our market sector. More players mean more options and more options lead to better prices and services. A healthy competitive insurance sector benefits everyone, from young drivers paying their first premium to family-run shops insuring their businesses. We must also demand full transparency from the system in how insurance premiums are calculated. Senator Nelson Murray mentioned there are differences in cost around the country. My home county of Roscommon has gone down five places from seventh on the list in the past 12 months. I believe this is due to the number of burglaries in which there was an increase of 20% in 2024. Putting that into context, the premium people are paying for insurance in our county has increased due to an increase in crime of about 43 instances. We need transparency on these premiums and how insurance companies are coming to these figures.
Pat Casey (Fianna Fail)
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I welcome the Minister of State to what is a very important debate on insurance. Fianna Fáil welcomes this debate on insurance and will be supporting the motion.
In Government, we are committed to tackling insurance costs to reform and ensure fair competition in all sectors. Since 2020, we have delivered a series of reforms under the action plan for insurance reform. While insurance premiums in some sectors, such as motor insurance, have fallen since 2020, more needs to be done to secure larger reductions in premiums across a broader range of areas. I will expand on that later. Having demonstrated how reforms can deliver reduced insurance prices, Fianna Fáil believes a further series of steps should be implemented.
The 2020 action plan for insurance reform successfully demonstrated the value of an all-in Government approach, led by the Cabinet subgroup on insurance reform, to reduce the cost and increase the provision of insurance, improving competition and affordability with key achievements including the rebalancing of the duty of care, reform of the injuries resolution board, the introduction of the personal injuries guidelines, which I will expand on later, enhancement of the national claims information database, and increasing competition in the market. Despite all this progress, the sector still faces insurance issues with affordability and availability. The benefits of the reform have not been fully passed on to customers and businesses. I believe further action to drive down insurance costs impacting households, drivers and businesses is required to ensure customers are paying a fair price for their insurance premiums.
Previous speakers have already mentioned the proposal by the Judicial Council to increase personal injury awards levels by 16.7% will wipe out any progress that has been made in the reductions of some premiums and will add a cost to sectors that have seen no decrease in their insurance premiums. Having a family business myself, this is one area where, in our case, since 2016, we have seen our insurance go up sixfold to a level that is almost unsustainable. We have heard speakers talk about transparency. There is absolutely no transparency in the insurance sector, specifically when it comes to potential claims businesses have received which can take six or seven years to resolve. Any company in that situation is being penalised by an additional premium every year because of the potential claim on the business. Even in seven years' time, if that claim leads to no payment, there is no rebate for the business. It will have suffered that increase in insurance premium for those seven years. The reality for small family businesses, and RGDATA has said this, is that they are on the edge and an increase in insurance premiums will only make them unviable, with the result that we will see many more family businesses close down across the country. The sector of small, indigenous family businesses is in trouble and we need to do more to support them across the whole sector and industry.
I welcome that our manifesto and the programme for Government pledge to develop a new action plan for insurance reform with a focus on encouraging further competition and working to enhance transparency and affordability across all types of insurance. The programme for Government, Securing Ireland's Future, commits to publish a new action plan for insurance reform. The plan's implementation will be supported by the re-establishment of the Cabinet subcommittee group on insurance reform to ensure insurance issues continue to receive the highest level of focus across Government, co-ordinated and chaired by the Tánaiste.
I also recognise the Minister of State has recently finished in the form of intense engagement with key stakeholders, including Insurance Ireland and the main insurance companies in the Irish market, to set out the Government's expectations that savings arising from the reform agenda will be reflected in reduced premiums as well as an increase in availability of cover. The programme for Government also commits to the expansion and support of the office to promote competition in the insurance market to ensure Ireland remains an attractive market for insurance. We have spoken about this before and it is another key element. The office chaired by the Minister of State has played a critical role in encouraging insurance companies to broaden their risk appetite. This has facilitated the coverage for high-risk sectors such as equestrian activities, adventure tourism and childcare. It beggars belief that childcare is considered a high-risk industry.
The Government remains committed to ongoing engagement with industries through the OPCIM to ensure reforms translate into increased competition and availability of cover and insurance. We are committed to continuing the work of insurance reform to ensure all sectors benefit from reduced premiums and increased availability of cover.
Joanne Collins (Sinn Fein)
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I welcome the Minister of State. While I welcome any debate which highlights the pressing issues of insurance costs and accessibility, we must move beyond words and deliver tangible solutions for our citizens. This motion, like many before it, rightly identifies the challenges but the question remains: does this Government's action match the urgency of the problem?
I want to focus on two critical areas where the current system is failing: the existential threat facing homeowners of our unique thatched homes, and the crippling burden of motor insurance in rural Ireland. That burden is made worse by the chronic lack of public transport. The crisis facing owners of thatched homes is an issue I have spoken about previously in the Chamber and it remains dire. These are more than just homes. They are living monuments of our heritage, yet their owners face soaring insurance premiums that often exceed €2,500 or, worse, no cover at all. With up to half of thatched properties uninsured, families live under constant threat. Without insurance they cannot sell their homes and they risk losing everything if disaster strikes and find it very difficult to mortgage their homes. Insurers blame fire risks and structural concerns. While those risks do exist, they are manageable with proper precautions. Instead, the industry has largely withdrawn, leaving families isolated and vulnerable. This is a clear market failure that threatens people's homes and our cultural heritage. We must engage with insurers, push for fairer policies and learn from successful international models.
Motor insurance is a lifeline for rural communities. For many rural families, a car is essential, not a luxury. It is their only way to get to work or school, access medical care and carry out basic and necessary tasks such as shopping, yet rising motor insurance premiums combined with scarce public transport create an impossible choice between paying unaffordable premiums and facing isolation. Young drivers suffer disproportionately and often pay more in insurance than the cost of their vehicle. This forces many young people to leave their communities, draining rural life and rural areas of their future. We need transparency and fairness in how insurers access risk. Are rural drivers being unfairly penalised simply because of their address? It is time we had a full review of the actuarial models and secured a commitment to openness about the setting of premiums.
On that note, I find it troubling that while the Government speaks about transparency, it has repeatedly blocked a Bill put forward by my colleague, Deputy Pearse Doherty. The Judicial Council (Amendment) Bill would have brought much-needed openness and accountability to the insurance sector. I find it hypocritical of the Government to talk about transparency in motions while blocking legislation that can deliver transparency.
This motion is a chance but only if it is matched by real and urgent action.
Nessa Cosgrove (Labour)
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I, too, welcome the Minister of State and this debate. The Labour Party, in our submission on the new action plan on insurance reform, highlighted a number of areas of reform, including transparency, high premiums which do not match up with the reduced number of claimants, competitiveness, tackling fraud and investment in innovation and skills. The areas I will focus on today are affordability and availability.
In cities, towns and villages throughout the country, including my area of counties Sligo and Leitrim, many community groups formed for the sole purpose of developing playgrounds for their children and communities. I was one of those parents who started on the journey of developing a playground in my local housing estate. Sligo County Council was extremely helpful in helping us to secure the land. We also knew we were eligible to secure more supports from organisations like the Sligo LEADER group to help with the initial set-up costs. However, when we spoke to many other parents involved in similar community groups we soon realised that we were only starting on the fundraising journey. We did not realise we would have to fundraise to cover insurance costs every single year. Sadly, many of these playgrounds were forced to close or were ineligible for insurance. Many stayed closed while others had to remain closed for long periods due to an inability to cover the cost of rising insurance costs, despite no claims.
The Labour Party has been raising this issue for many years. We have called on the State to develop new initiatives such as pooled group insurance schemes or broaden the remit of the IPB Insurance to support the voluntary and community sector. I commend the Alliance for Insurance Reform which has been doing great work raising this issue and engaging local public participation network, PPN, groups which can see first-hand the difficulties faced by so many communities regarding insurance.
Many playgrounds in cities, towns and villages are managed by the local authority and their insurance costs are covered but many others are not. This is obvious in rural areas where communities have traditionally been responsible for covering the cost of insurance. I was delighted to hear the Minister of State recently announce that the Tidy Towns committees would have their insurance costs covered by local authorities and IPB Insurance. While this is very welcome news, I ask that the scheme be extended to include all playgrounds. Playgrounds are public amenities that add a great deal of social capital to an area. It is hard to continually return to the same parents every year to raise funds. Many parents do not have the money in the first place.
Why are school playgrounds, pitches and recreational areas not available to all children outside of school hours? Schools are told that children are not insured to be on the premises outside of school time but why not? It is not beyond the capability of insurers to ensure the liability insurance so many of our children have to take out when they are in school is extended to every child to cover them while they are on school grounds, regardless of whether that is during or outside school hours. Play, active play in particular, is so important for the development of children and this should never be jeopardised by rising insurance costs.
Seán Kyne (Fine Gael)
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The Minister of State is welcome. I acknowledge the work of my colleague, Senator Nelson Murray, in drafting this Private Members' business and advocating for businesses up and down the country that face issues with insurance.
Insurance has been a huge issue in this country for some years. In fairness, the Government has done a lot. The 16.7% increase recommended for personal injury guidelines is excessive. I fully concur with Senator Nelson Murray on that.
A lot of good work has been done by Governments in recent years. For example, the Cabinet committee gave a focus to insurance issues and the measures in the action plan for insurance reform were implemented. Issues flowing from that included the establishment of an office to promote competition in the insurance market, the introduction of new personal injury guidelines, the making of perjury a statutory offence and the introduction of a duty of care in legislation enacted in 2023. All these actions are positive in terms of providing certainty for the market but on the understanding and in the belief that they will reduce insurance premiums. While there has been some stability at different times, we have not seen the level of success we would like in terms of premiums.
In May 2024, An Garda Síochána launched a new system to identify uninsured vehicles. That system has been a success because the number of uninsured vehicles has dropped. This leads one to believe that car insurance premiums would also drop but that has not happened, which begs the question as to why. The Garda's use of this technology has acted as an incentive for motorists who, heretofore, were not insuring their cars to insure their vehicles. Why then has the cost of premiums not fallen as a result?
The extension of the review of the personal injury guidelines to every seven years is a sensible proposal. Excessive increases would be avoided if a review were carried out every seven years rather than every three years. That is an important measure.
The prioritisation of legislation providing for a right to be forgotten for cancer survivors has been discussed in these Houses and elsewhere. According to a report by the Irish Cancer Society, three in every five people affected by cancer find it difficult to access financial products such as life insurance and mortgage and income protection insurance. This is a real concern for families given that one in three of us will get cancer in our lifetime. I welcome the commitment in the programme for Government to legislate for this right. I hope it will be a priority because cancer sufferers and those who have recovered from cancer deserve the same protections as everyone else. People cannot get a mortgage without first having life insurance, so this is a necessity.The Injuries Resolution Board has worked but can be strengthened. The resolution of cases outside the courts has been positive in reducing payouts, which is to be welcomed. Concern has been expressed over litigation fees in dealing with these cases. The less the courts are involved, the better, if payouts and premiums paid are to be reduced.
Overall, much positive work was done by the previous Government and the one before that. We need to continue to improve the outcomes for consumers up and down the country, be they private individuals who want to ensure their cars or the businesses that are creating employment and, as Senator Murray highlighted regarding her business, providing leisure opportunities for children and parents alike. We realise the importance of the simple things we could take for granted, including the bouncy castles at fairs and shows, and all that go with them. If in the future we are to have these things, which have in some ways become necessities for children, we need to ensure we can afford the insurance premiums and that the payouts are not excessive. We need to continue on the path we have been on in recent years to ensure we realise this.
Mike Kennelly (Fine Gael)
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I welcome the Minister of State to the House. I welcome the proposal and acknowledge the work Senator Linda Nelson Murray and her seconder have put into this.
I, too, am against the very excessive increase of 16.7% proposed by the Judicial Council following the review of the personal injuries guidelines. This proposed change would undermine the progress we have made in rebalancing the system. It would send the wrong message, not just to insurers but also to every small business owner, community group and ordinary consumer who was promised a fairer, more affordable insurance market.
I speak today to support this motion, which both recognises the work done so far on insurance reform and outlines the critical next steps. Since the action plan for insurance reform was published in 2020, we have seen genuine progress. Four implementation reports have tracked that work and the crucial steps that have been taken, such as the establishment of the office to promote competition in the insurance market and the introduction in 2021 of the personal injuries guidelines, which brought greater consistency and reduced compensation levels across many types of claims. The reform of the Injuries Resolution Board is a key milestone. It introduced mediation as a method to resolve employer liability claims, mandated stronger identity verification and required that injuries in claims be tied clearly to the actual incident. All of these are essential measures in reducing fraud and restoring trust in the system.
I especially welcomed the decision in 2021 to make perjury a statutory offence. Insurance fraud is not a victimless crime; it drives up premiums for everyone. The move in 2021 sent a strong message that we would not tolerate dishonesty that penalises honest customers.
We have also rebalanced the duty of care, tightened solicitor advertising regulations, enhanced co-ordination between An Garda Síochána and the insurance industry and established an insurance fraud co-ordination office to ensure consistency and accuracy in fraud detection and reporting. The national claims information database has been expanded, improving transparency and helping policymakers track the real impact of reforms. These are all significant steps but let me be very clear: consumers and business owners are still not seeing the full benefit. They want one thing, lower premiums, and rightly so. That is the ultimate measure of success for any insurance reform.
We cannot claim victory while community groups are struggling to get event cover or small business owners are being squeezed by rising costs. We must demand greater transparency in how premiums are calculated and ensure savings created by reform are passed on to the people paying the bills.
I welcomed the launch last month of a new Garda system to detect uninsured vehicles. This is already showing results, with a significant drop in uninsured driving. This is a real-world example of reform in action.
Looking ahead, we first need to commit to reviewing the personal injuries guidelines every seven years, as indicated by Senator Linda Nelson Murray. We must not increase awards arbitrarily and instead ensure they remain balanced and evidence based. Second, we must prioritise legislation for the right to be forgotten for cancer survivors. A past diagnosis should not mean lifelong insurance discrimination. Third, we should promote insurtech, innovation and competition, including from new domestic and international entrants. Fourth, we should accelerate the release of claims data to keep consumers and policymakers informed. Fifth, we should strengthen the Injuries Resolution Board further so more cases are resolved out of court, saving time and money. Sixth, we should maintain the Cabinet subcommittee on insurance reform to drive political accountability.
We must be honest about emerging risks, especially climate-related risks. In my area, a family affected by flooding in recent years entered the OPW’s relocation programme but still has not found a house. The number of properties that have no insurance because of extreme weather events has to be top of the agenda. The widening insurance protection gap demands a strategic response both to protect people and keep Ireland attractive as a global insurance hub.
At the heart of this issue is a very simple idea: insurance must work for people. This is not about protecting profits; it is about protecting livelihoods. It is about ensuring families, small businesses and voluntary groups can afford the cover they need. The public has been patient and now they deserve results. There is a need to focus, deliver what was promised and ensure the real beneficiaries of reform are the people and businesses of Ireland.
Mark Duffy (Fine Gael)
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I thank the Cathaoirleach. I welcome the Minister of State. I welcome the opportunity to speak on such an important matter that affects towns and villages right across the country. I compliment the work of Senator Nelson Murray, a strong advocate in the House of insurance reform, reflecting her own lived experience and the challenges that face businesses like hers. In County Mayo, businesses have closed down. The role of businesses such as soft play centres, which are the heartbeat for young families in an area where it rains more than it does not, cannot be overstated. The insurance costs that force family-owned businesses that bring so much joy to communities cannot be supported. The proposed award increase of 16.7% is totally excessive and we need to make that clear to the Minister of State and work together to ensure we push back on it.
Ahead of this evening’s discussion, I was in touch with Brendan Kenny, the chief executive of Ireland’s Association for Adventure Tourism. That is a representative body for outdoor activity tourism on the island of Ireland. It has 210 members and these members offer 50 different activity experiences, including hiking, kayaking, biking, horse riding, surfing, adventure centre and water park pursuits, and much more. This is key to domestic tourism but also to the international tourism market, and it results in so much joy, fun and excitement across the country. Local examples of providers in County Mayo and the west include Delphi Resort, which many are familiar with, Wildlands, Westport Adventure Centre, Westport Bike Hire, Clew Bay boat tours, Baysports, Summer SUP, and Go!Trekking! These are just a flavour of some of the association’s member organisations that could be negatively impacted if the increases go ahead.
The industry is totally opposed to the increases. I do not blame it because it worked alongside the Alliance for Insurance Reform and fought hard for reforms. The reforms delivered in recent years have just this year begun to show positive results for businesses. The cost for businesses in the Irish sector is still four times greater than that for equivalent businesses in the UK and six to eight times more expensive than that for their counterparts across Europe. There is a clear disparity and we need to work to support the businesses being affected by it. Outdoor activity tourism is a vital cog in the tourism ecosystem and provides fundamental pathways to promoting physical and mental health activities. Such businesses are not only providing a lot from a tourism perspective, but they are also being supplied by talented young people who are educated in outdoor tourism and orientated to work in this industry. If the industry collapses, it has a knock-on effect on outdoor education provision and study at the Mayo campus in ATU, which has a strong and vibrant course that could be negatively impacted if the awards guidelines were increased.
The proposal is excessive. I welcome IPB Insurance's efforts regarding supports for Tidy Towns. I wish to see us go further on that if possible and support the voluntary sector more broadly. Volunteers take on a lot by contributing their time, expertise and talents. Their contribution to society and their communities should not involve fundraising to pay excessive insurance premiums on, for example, historic buildings that they own, rent or maintain. They should be empowered to contribute in a positive manner to the community and not have to fundraise to pay for excessive insurance.
We should not legislate joy out of society and communities. We need to create a happy balance and medium for protecting those who are affected by injury while also making sure it is not exploitative and is done in a way that promotes and encourages activities and centres that offer so much joy to communities and societies right across Ireland.
I thank the Minister of State for his time and Senator Nelson Murray and the Cathaoirleach for facilitating the conversation.
Cathal Byrne (Fine Gael)
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I support this motion and commend the work done by my colleague, Senator Nelson Murray, in this area. I know the Minister of State has taken a personal interest in this matter for several years.
These proposals are common sense and reflect many of the issues experienced daily by small and medium businesses, private clubs and societies, and sports groups. In my own county of Wexford, many of these issues have been directly highlighted to me, particularly by sports clubs and small businesses that are concerned the rising cost of insurance will put them out of business.
One of the key considerations must be the balancing of the need to protect individuals who endure, through no fault of their own, serious and life-changing injuries with the need for a viable insurance market that offers low premiums for individual consumers to purchase. Trying to find this balance will be difficult and I have no doubt the Minister of State and his officials are aware of that, but it is important that some of the commonsensical proposals in motion be considered. The Cabinet subcommittee on insurance was set up under a previous Minister of State from Wexford, the former Deputy Michael D'Arcy, who did much work on the action plan for insurance reform. The work done in recent years is reflective of that.
I am concerned that, while the compensation being paid out through the personal injuries resolution process and courts, as a whole, appears to be on the way down, the premiums being charged to consumers are certainly not. There must be a greater examination of the bumper profits being made by insurance companies that also reflects the need for a viable insurance market. There is a need for insurance; it exists for a purpose. However, the reductions in payouts must be passed back on to the consumers. There are some good proposals in the motion about how best to maximise that and Senator Nelson Murray did good work in making those points in her contribution.
The penalties for insurance fraud, the need for new competition in the market, the work being done on the claims database and the high penalty introduced for perjury are all commonsensical measures that are driving down payouts. However, we need to see action on a reduction in claims. I am interested to hear from the Minister of State specific measures his Department is considering and intends to take in the next five years to address this issue. Having made these proposals, it is important that we be in a position to tell people what, on the one hand, the Government is doing to drive down payouts and protect those who are in need of compensation after suffering life-changing injuries and, on the other, how it is also ensuring that we have a viable insurance market where the difference between people choosing between closing down this year and keeping their doors open next year or the year after is not the cost of insurance, which no one wants to see.
I wish to highlight the idea of there being a further rebalancing of the Occupiers' Liability Act and duty of care. Good work has been done in this regard, but there could be more. For example, if people come onto a farmer's land, the farmer must have the Occupiers' Liability Act signs up warning them they are now on private property. It should be presumed rather than needing to be warned that, once people climb over a fence, open a gate or go into somebody's yard, they are on someone else's property and, therefore, they are the people with the duty of care. It should not rest entirely on the farmer to put up the signs and have consulted a solicitor for advice on what the parameters of the Occupiers' Liability Act are.
Farmers just want to be able to farm, business people just want to be able to run a business, and people in a voluntary and community organisation just want to be able to get on with the running of that. They do not want to have to consult a solicitor for an overly technical issue and ensure the specific wording of signs meets the requirements of the Occupiers' Liability Act. This area could be tightened up and a further rebalancing of the duty of care could be considered. Work was done on this approximately two years ago. Perhaps the Department has considered the matter and whether the rebalancing has gone far enough. I am interested in the Minister of State's thoughts and reflections on this.
I commend my colleague, Senator Nelson Murray, on the great work she has done on this. I commend the motion to the House.
Mark Daly (Fianna Fail)
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If there are no other Senators offering, before I call the Minister of State, I welcome Martin Monaghan from Longford, who has left his father at home because, apparently, he would give anyone a good grilling. People who have been on the Seanad campaign and have called into the shop will have been put through their paces. I believe even Ministers have been put through their paces on the shop floor. Mr. Monaghan is most welcome to Seanad Éireann. Next time, he will bring the whole gang and his father, too. I thank him for being here today.
Robert Troy (Longford-Westmeath, Fianna Fail)
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If the Cathaoirleach will forgive me, even though I am not a Member of this House, it is good to see one of my local councillors and his partner Deirdre up visiting the Dáil this evening. I am glad to say it was not me who was the Minister getting the grilling in the butcher shop during the Seanad campaign. I sincerely thank Senator Nelson Murray and all our colleagues in the Fine Gael group for tabling this important motion on insurance reform, and all those who contributed to the motion in a positive way. It is a privilege to be here in the Seanad this evening to discuss the Government’s plan in this critical area and to hear the contributions of Senators from across the House. Let me be absolutely clear; the Government regards insurance reform as a key priority. We are determined to take the necessary steps to reduce the burden of insurance costs on households, motorists, businesses and community organisations throughout the country.
When we launched the action plan for insurance reform in 2020 we knew we were setting ourselves an ambitious agenda. That plan set out a comprehensive series of actions designed to tackle the structural problems in the insurance market, reduce costs, increase transparency and improve access. Among the most significant reforms we implemented were the rebalancing of the duty of care, helping to bring greater fairness and certainty to liability claims; the major overhaul of the Injuries Resolution Board to speed up settlements and lower legal costs, and I am particularly proud of the role I played in that when I previously served as Minister of State in the Department of enterprise; and the introduction of the personal injuries guidelines, which have brought consistency and predictability to awards, as mentioned by a number of speakers. We delivered structural change to the personal injury claims process, making it more efficient, more cost effective and, above all, more predictable for those seeking redress.
These changes have also improved the attractiveness of our market. Since the introduction of the reforms we have seen new entrants into the Irish motor insurance market such as OUTsurance, Revolut and Fastnet. At the same time, established insurers have expanded their offerings into previously under-served areas like hospitality, SMEs, sports and leisure. That is a strong vote of confidence in the reforms we have delivered and in the potential of the Irish market, which is functioning fairly.
However, we all recognise that we are not yet where we want to be and more needs to be done. Despite the progress made, too many consumers and small businesses are still not feeling the full benefits of these reforms in their pockets. Premiums in some areas remain high and while the trend in motor insurance premiums has, overall, been downward, with prices still 34.4% lower than their peak in 2016, there have been recent increases that are of understandable concern to the public.
It is important to acknowledge that the recent price pressures are not unique to Ireland. They reflect wider global inflationary factors, including higher repair costs due to advanced vehicle technology, ongoing supply chain issues and labour shortages. These cost drivers are real. However, that does not mean we can be complacent. We need to remain focused on tackling domestic cost drivers and ensuring consumers receive the full benefit of the reforms we have implemented. In committing to a new action plan for insurance reform, the Government will build on the work already done and ensure that improvements in affordability, transparency, access and competition continue in this next phase of insurance reform. That is why, earlier this year, I launched a public consultation on the next action plan for insurance reform. I was determined that we would do this very early in the new Government term. This consultation was short, concise and closed in May. It received 73 submissions from a wide range of stakeholders, including public bodies, industry representatives, small businesses, voluntary groups and some political parties. Today's debate will also feed into that public consultation. The submissions were grouped into key themes, namely, transparency and affordability; competitiveness and availability; fraud; innovation and skills; and the climate protection gap.
The feedback was both insightful and constructive. Stakeholders called for continued reform of the Injuries Resolution Board, which I am in favour of, stronger enforcement and oversight and a more formalised role in the review of personal injuries guidelines. Many highlighted the disproportionate legal costs in litigated cases and the need to streamline those costs, particularly in lower value claims. There were calls for greater transparency in how premiums are calculated and for efforts to boost financial literacy around insurance products. We also heard strong support for measures to attract more international insurers into the Irish market, as well as proposals to modernise regulatory processes to support innovation, talent development and the growth of insurtech. My officials are now carefully analysing the consultation feedback and I expect to bring a draft action plan to the Cabinet subcommittee on insurance reform in July. Our aim is to publish the final plan by the summer. This action plan will guide the direction of insurance reform for the coming years, building on progress to date but also addressing the ongoing frustrations that consumers and businesses still experience. An action plan is important because it is measured and we will be held accountable for the actions we have in that plan.
In regard to the judicial review of the personal injury guidelines, this issue has generated significant discussion not only in this House but in many channels over the past number of months. One point I make regarding the proposed 16.7% increase in general damages for personal injury awards is that no decision has been taken. The decision to accept or reject it will not be taken by one particular Minister because it is a whole-of-government decision. While the Government fully respects the independence of the Judicial Council, it is essential that any proposed changes are underpinned by robust evidence. We must understand the broader implications for the insurance ecosystem, including costs for policyholders and the sustainability of the market.
The introduction of the 2021 guidelines was a landmark moment in the reform agenda. The guidelines brought clarity, consistency and a long-overdue realignment of awards with international norms. We are still in the early stages of assessing their full impact and we must proceed cautiously to avoid unravelling the gains made. It was a regrettable step in the most recent legislation to set a review period of three years. The motion now proposes a seven-year period which is much more realistic and would enable the gathering of the robust evidence we are all looking for. We now know from the NCID data that litigated claims carry significantly higher legal costs, approximately 28 times greater than those resolved through the Injuries Resolution Board. These claims also take a longer time to resolve - 5.1 years on average for litigated motor claims versus 2.7 years for claims via the Injuries Resolution Board. The contrast is starker for employer and public liability claims. We must avoid a situation where increasing awards drive a return to higher premiums, slower settlements and more litigation. This would do a disservice to everyone, not least the injured persons. We will continue to engage constructively with the Judicial Council and all stakeholders to ensure the guidelines remain effective and evidence based.
In regard to the right to be forgotten, we are actively examining how we can better support cancer survivors to access insurance on fair terms. The right to be forgotten is a complex but important issue. Too many people who have overcome life-threatening illnesses find themselves locked out of financial services not because of risk but because of outdated policy assumptions. We are working with colleagues across the Government and with industry to explore policy options that ensure equity, compassion and dignity for those affected. This reflects our broader aim that insurance must not only be affordable but accessible to all.
I acknowledge the legislation that was put forward in the previous Seanad by then Senator Ardagh, now Deputy Ardagh, and Senator Clifford-Lee. Senator Kyne mentioned it this evening and requested that it be a priority. I assure Members that it is a priority for me and the Government. I have already met with the Irish Cancer Society and Insurance Ireland in relation to advancing this proposal. It is worth noting that insurance companies have been operating under a voluntary code in this area for the past 12 months. A review was done, the outcome of which we received recently. The outcome was very positive. That has strengthened my hand in terms of bringing this forward as priority legislation later this year.
I will conclude by outlining the three goals I want to achieve during my time in this role. I want to ensure the insurance market works fairly and efficiently for both providers and policyholders. We have to acknowledge that the insurance industry is a substantial employer in Ireland so we need to be fair to providers and policyholders. I will make sure that insurance products are available and accessible, especially for such sectors as childcare, community and voluntary organisations, sports and recreation. The previous speaker acknowledged the good work IPB did in relation to Tidy Towns. That is something I would like to work on further. A colleague on the other side of the House also raised this. There is an opportunity with IPB in the area of playgrounds, community events, festivals, etc. More work needs to be done in that regard, but there is an appetite on the part of IPB to do more. When it has an appetite to do more for less, we will try and support that.
My third goal is that not only will insurance be available for individuals, families and businesses, it will also be affordable. I have started work in this regard. I have met all the CEOs of the various insurance companies in Ireland. I have met the Alliance for Insurance Reform, Insurance Ireland and IPB. We are determined to work on achieving what we set out to achieve. We are on the right path, but we need to build on the momentum that has been created.
I thank the Senator for bringing this motion before the Seanad because it maintains the momentum to which I refer and the focus on this issue. The public expects a system that is fair, fast and functional. With continued collaboration across the Government, the Oireachtas and all stakeholders, I am confident we can deliver a stronger, more competitive and more compassionate insurance market for the future.
Linda Nelson Murray (Fine Gael)
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I thank the Minister of State for everything he highlighted. I really appreciate it.
Since 2020, we have put a great deal of work into everything relating to insurance reform. One of the first things was the establishment of a Cabinet subcommittee. I do not think we had seen anything like that over the previous 15 years, so it was important. I would like the subcommittee to meet regularly and deal with the issues that have been raised here today.
A few of my colleagues raised issues that the Minister of State might come back on afterwards. For example, thatched houses were referred to quite a lot. Occupiers’ liability is another issue in the context of people coming onto land and farmers being worried.
I am grateful colleagues mentioned that they think an increase of 16.7% is excessive. I am glad the Minister of State responded on that and that he said it is not too late. I hope we might reconsider this before it comes across our desks, because none of us is comfortable with it. I would appreciate it if it could be examined.
When I was a councillor, I sat on IPB. The only conference I got to go to was very informative. I could not understand how IPB was able to say that because of the Government’s reforms, it had reduced its premiums to all local authorities by 30%, yet we have not seen that from the private insurance market in the context of public liability, employers’ liability or motor insurance claims. The Minister of State indicated that the number of motor insurance claims is down since 2016. If we look back to 2010 or 2007, however, we can see that they are far higher. It depends on the period one looks at. Over the past two years, motor premiums have increased. I am scared about the report for the latter part of last year. They went up by 9% in the first half, and I would say that they increased even more in the second half. That is scary. Younger drivers are doing very well in relation to incidents, but they are being penalised by having to pay premiums of the order of €4,000. I would like these drivers to be considered also.
I welcome the right to forget for cancer survivors in the context of insurance. A number of colleagues referred to this matter. After everything people go through when it comes to cancer, the last thing they need is having to fight to get insurance. They do not need any more stress.
On the capping of legal fees in the District Court and the Circuit Court, I suggest bringing fees in the Circuit Court to the level that applies in the District Court. That is something we might look at.
Fine Gael has made a good submission. Most of the other parties put in good submissions. I said that the Department received more than 60. In fact, it got 73. This shows the appetite among the different firms and associations. They really want to see it. Earlier, I met the Small Firms Association. It conducted a survey six to 12 months ago in which 45% of its 2,000 members reported an increase in their premiums. That is nearly half. Asked about the top three issues affecting businesses the most, the first was labour costs and the second was insurance.
Even though we have introduced all these great reforms – and I am proud to have played a really small part in bringing that to the attention of many people – we have a long way to go. I know the Minister of State in terms of his work, and I trust that he will do it. He does understand it all. He is a difficult position in relation to the personal injury guidelines. I do not think he wants to see an increase. I hope we do all we can in that regard. Senator Casey also comes from a small business background. He, too, raised the importance of there not being an increase or even that we would negotiate the percentage.
I thank the Minister of State for coming before the House. I really appreciate it. I thank him for accepting the motion. I thank the nine Fine Gael Senators who came here today. It shows how much Fine Gael is invested in insurance reform. I really appreciate that and thank everyone.