Fiona O'Loughlin (Kildare South, Fianna Fail)
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94. To ask the Minister for Finance the steps he will take to address alleged cartel like activity in the insurance industry; and if he will make a statement on the matter. [42077/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Competition and Consumer Protection Commission (CCPC) is the statutory independent body responsible for the enforcement of domestic and EU competition law in the State.  Section 9(5) of the Competition and Consumer Protection Act 2014 provides that the CCPC is independent in the performance of its functions, including carrying out investigations of alleged anti-competitive practices.  

It is my understanding that the CCPC has been undertaking an investigation of suspected breaches of competition law in the motor insurance sector.  However, as investigations and enforcement matters generally are part of the day-to-day operational work of the CCPC, neither I, nor the Minister for Business, Enterprise and Innovation, nor the Central Bank of Ireland, has a direct function in respect of such matters.

Separately, the European Commission on 4 July 2017 carried out an unannounced inspection at the premises of companies active in motor insurance in the State.  The basis for this inspection was a concern by the Commission that the companies involved may have engaged in anti-competitive practices in breach of EU antitrust rules that prohibit cartels and restrictive business practices and/or abuse of a dominant market position.

Again, I am not in a position to make any comment in relation to such actions being taken by the European Commission.  Any inspection or investigation being undertaken by the Commission is done independently and I have no insight into the development of any such exercise.

Nevertheless, my Department has taken an active role in tackling insurance costs.  The issue of rising insurance costs was the main impetus for the establishment of the Cost of Insurance Working Group in July 2016.  It published the Report on the Cost of Motor Insurance in January 2017.  The Report makes 33 recommendations with 71 associated actions to be carried out in agreed time-frames, which are set out in an Action Plan. 

Work is ongoing on the implementation of the recommendations by the relevant Government Departments and Agencies and there is a commitment within the Report that the Working Group will prepare quarterly updates on its progress.  The second such update was published on the Department's website on 21 July 2017 and shows the progress to date on the overall implementation of the recommendations, with a particular focus on the 17 action points which were due for completion in the second quarter of 2017.  All 17 of these action points were completed by this deadline.  The third quarterly update will issue in the coming weeks.

In addition, in January, the Cost of Insurance Working Group embarked on its second phase to examine issues around the cost of insurance for businesses, specifically employer liability and public liability insurance. It is hoped that a final report will be published during the autumn/winter term. 

I believe that the implementation of these reports will make a difference to the pricing of insurance premiums over the next 12-18 months.  It is envisaged that the implementation of all the recommendations cumulatively, with the appropriate levels of commitment and cooperation from all relevant stakeholders, will achieve the objective of delivering fairer premiums for consumers.  I also believe that the Setanta judgment, by finding that MIBI is not liable to meet third party claims, removes a major uncertainty from industry, which I would expect to be reflected in motor insurance pricing in the short to medium term.

It should be noted that the most recent CSO data (for August) indicates that private motor insurance premiums have reduced by 14% year-on-year.  While the CSO statistics indicate a greater degree of stability on an overall basis, these figures represent a broad average and therefore there are many people who may still be seeing increases.  I am hopeful however that greater stability in pricing will continue to occur, and that premiums will continue to fall from the very high levels of last year.