Ruth Coppinger (Dublin West, Solidarity)
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207. To ask the Minister for Finance the measures he will take to reduce the cost of insurance for taxis; and if he will make a statement on the matter. [55075/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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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 as to the pricing level or terms or conditions that should apply in such cases. 

However, it is acknowledged that pricing in the motor insurance sector has been subject to a lot of volatility in recent years, from a point where some premiums appeared to be priced at an unsustainably low level to the more recent experience of large increases.  Rising motor insurance premiums was the main impetus for the establishment of the Cost of Insurance Working Group in July 2016. Its Report on the Cost of Motor Insurance was published in January 2017.  The Report makes 33 recommendations with 71 associated actions to be carried out in agreed timeframes, which are set out in an Action Plan.  These recommendations were formulated to address the issue of increasing motor insurance costs for taxi drivers and other motorists, whilst taking account of the need to ensure a financially stable insurance sector.  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 most recent of these was published in October 2017 and is available on my Department’s website at .  The fourth quarterly update will be published shortly.

With regard to the taxi sector in particular, I am advised that insurers use a combination of rating factors in making their individual decisions on whether to offer cover and what terms to apply.  These terms can include the age of the driver, as well as the type and age of car, the claims record, driving experience and penalty points of the driver, the number of drivers, how the car is used, etc.  My understanding is that insurers do not all use the same combination of rating factors, and as a result prices and availability of cover varies across the market. In addition, insurance companies will price in accordance with their own past claims experience.  In the case of taxi drivers, I understand that insurers take into account the nature of the taxi business, which involves driving for hire or reward extensively, and in their view has a much higher risk of injury claims from passengers and other road-users as a result.

I understand that taxi sector representatives made representations to my Department and the Cost of Insurance Working Group and these were taken into consideration during the review.  The position of the taxi sector was acknowledged by the inclusion in the Report of a recommendation for the Advisory Committee on Small Public Service Vehicles (commonly referred to as the Taxi Advisory Committee (TAC)) to enter discussions with Insurance Ireland in order to explore solutions for drivers in the sector.  I understand that the TAC met with Insurance Ireland on May 22nd last year to explore solutions for drivers in the sector and reported to the Minister for Transport, Tourism and Sport that it agreed that it will continue to engage with Insurance Ireland on this issue in addition to providing a platform for relevant representative groups to provide their views on the cost of insurance. 

It should be noted that the issues raised by the taxi sector were in the main similar to those affecting consumers generally, notwithstanding that there are risks that are specific to the sector.  While there is no silver bullet to reduce the cost of insurance, I believe that with the cooperation and commitment of all parties, fairer premiums for consumers, including taxi drivers can be delivered over the implementation period of the Cost of Motor Insurance Report.  I would note that the most recent CSO data (for November) indicates that private motor insurance premiums have reduced by 16.3% from the peak in July 2016.  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.  However, I am hopeful that this greater stability in pricing will be maintained and that premiums should continue to fall from the very high level of the last years.