Fergus O'Dowd (Louth, Fine Gael)
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311. To ask the Minister for Finance if a response will issue in relation to matters raised by a person (details supplied) regarding the insurance market; if his attention has been drawn to such an issue; the measures he is taking to ensure this does not take place; and if he will make a statement on the matter. [39558/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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At the outset, it is important to note that neither the Minister for Finance, nor the Central Bank of Ireland, has any influence over the pricing or provision of insurance products, as this is a commercial matter assessed on a case-by-case basis. This position is reinforced by the EU legislative framework for insurance (the Solvency IIDirective). Furthermore, I cannot comment on individual cases or comments made by an individual broker, such as those referred to with the Deputy’s question.

As committed to in the 2020 Programme for Government, Government is prioritising reform of the sector with particular emphasis on motor, public, and employer liability insurance. The whole-of-Government approach, being taken through the Action Plan for Insurance Reform,therefore sets out 66 actions, which aim to improve both the cost and availability of this key financial service, particularly for businesses. In this regard, I welcome the implementation of the Personal Injuries Guidelines, which represents a key achievement of this insurance reform agenda, and was realised several months ahead of schedule.

The Guidelines significantly reduce award levels for many categories of common injuries. Of note is that a number of these will now move to the jurisdiction of the District rather than the Circuit Court, thus reducing associated legal fees. The Guidelines also provide guidance in relation to injuries previously not included in the Book of Quantum and will be used by both the Personal Injuries Assessment Board (PIAB) and the judiciary. Therefore, they should help to bring more certainty to claimants and insurers, and as such reinforce the benefits of using the PIAB to settle claims. This in turn should further reduce the costs of claims, particularly legal fees. I have previously set out my view that these costs, rather than the profit component, tend to represent a bigger factor in the cost of insurance premiums. As such, it is important that they are lowered.

As Minister for Finance, my expectation is that insurers will now commence reflecting savings from reduced award levels to customers, in line with past commitments, and I intend to hold them to account on this. Minister of State Fleming met with the CEOs of the main insurers operating in Ireland to set out the Government’s expectation in this regard. These engagements were positive, with insurers indicating that they will begin lowering premiums in response to the Guidelines. The Minister of State will meet the CEOs again later this year to review their ongoing response to this and other key reforms. Work is also underway to help improve transparency through the National Claims Information Database, so that the impact of the Guidelines can be seen in future motor, employer and public liability reports.

In relation to recent price changes for insurance, I would note that, according to Central Statistics Office (CSO) data for June 2021, motor insurance prices are continuing to decline. Motor insurance prices in June were 34.5% lower than their peak in July 2016; and 5.3% lower than when the Government’s Cabinet Committee Sub-Group on Insurance Reform was established in September 2020.

I would like to assure the Deputy that work remains ongoing across Government to deliver further elements of the Action Plan, including measures to reform the PIAB, reduce fraud, and make changes to the duty of care in order to strengthen waivers and notices. It is my hope that the implementation of these key actions in particular should further help to improve the affordability and availability of insurance for all consumers, businesses and voluntary groups. Finally, while it is not possible to comment on the specifics of any case, I continue to expect that insurers will treat customers fairly and where this is not the case, I encourage consumers to raise the matter if appropriate with the Financial Services and Pensions Ombudsman.