Written answers

Thursday, 13 July 2017

Photo of Charlie McConalogueCharlie McConalogue (Donegal, Fianna Fail)
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170. To ask the Minister for Finance if his attention has been drawn to the financial pressure being experienced by livestock markets as a result of rocketing insurance costs; the steps his Department is taking to address the rising costs of insurance for marts; and if he will make a statement on the matter. [34192/17]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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This matter has been brought to my attention and was the subject of a Topical Issue discussion last week. In preparation for this discussion, my officials contacted Insurance Ireland who advised that livestock marts have significant exposure to injuries to employees and members of the public. This has resulted in claims occurring with a level of frequency which has led to a reduction in market capacity due to the hazardous nature of the risk. In response, insurers have developed active risk management programmes in order to try to reduce the level of accidents and injuries. In addition, I understand that insurers have been working with marts with a view to implementing improvements in management practices and facilities to reduce claims as this is the key area to manage claim costs.

However, Insurance Ireland has advised that they are not aware of any recent major increases in the cost insurance for agricultural mart owners. However, if the Deputy is aware of a specific issue facing an individual mart owner, I recommend that he or the mart owner raise it with Insurance Ireland who I understand are happy to discuss the issue as part of their free Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance.  Insurance Ireland can be contacted at feedback@insuranceireland.eu or 01-6761914. 

The Deputy should also note that in my role as  Minister for Finance I am responsible for the development of the legal framework governing financial regulation.  Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept.  This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.  Consequently, I am not in a position to review individual cases nor to direct insurance companies as to the pricing level or terms or conditions that they should apply in particular cases. 

Nevertheless, it is possible for the State to play a role in helping to stabilise the market and deal with factors contributing to the availability and cost of insurance.  In terms of measures being taken to tackle the cost of employer and public liability, the Deputy will be aware that this is being examined as part of the second phase of the Cost of Insurance Working Group. The Working Group is building upon the previous work done in the motor phase in order to determine how it can be applied in the employer and public liability insurance claims areas. The Working Group is also considering the impact of the cost of insurance on the competitiveness of particular business sectors, the impact of health and safety issues on the cost of insurance and other market issues. 

The Working Group has held extensive consultations with a range of stakeholders including the Irish Farmers Association, who provided a submission to the Working Group. This issue was not raised in their submission.

It is envisaged that the final results of the second phase will take the form of an addendum to the existing Report. As with the first phase, the aim is for all relevant bodies and stakeholders to work together in order to deliver fairer premiums for businesses without unnecessary delay.  As it is likely that employer and public liability risks is a factor in the cost of insurance for marts, any recommendations emerging from this review should be of relevance to the mart sector.

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