Tuesday, 21 September 2021
Department of Finance
At the outset it is important to note that neither I, nor the Central Bank of Ireland, can direct the pricing or provision of insurance products, as this is a commercial matter which individual companies assess on a case-by-case basis. This position is reinforced by the EU Single Market framework for insurance (the Solvency II Directive) which expressly prohibits Member States from doing so.
Nonetheless, this Government recognises the concerns felt by many groups, including in the childcare sector, regarding the cost and availability of insurance, and has therefore prioritised insurance reform through the Action Plan for Insurance Reform. As the Deputy may be aware, the Government recently published the first Implementation Report, which shows that work is progressing well to implement the Plan, with 34 of the 66 actions contained therein now completed.
One of the key achievements in the first half of this year was the implementation of the Personal Injuries Guidelines, which was realised several months ahead of schedule. These will bring more certainty to claimants and insurers, and as such will reinforce the benefits of using PIAB to settle claims. This, in turn, will reduce the costs of claims.
It is my expectation that insurers will pass on these savings to customers in the shape of reduced premiums across their product lines. Minister for State Fleming has had number of positive engagements with the CEOs of the main insurers operating here on the matter, and they have indicated that they will respond positively to the Guidelines. He will meet with them again later this year to continue to press their commitments in this regard.
Another significant achievement has been the creation of the Office to Promote Competition in the Insurance Marketwithin the Department of Finance, which is chaired by Minister of State Fleming. The Office has held meetings with a wide range of stakeholders including insurance companies, representative bodies, civil society groups and state regulators on issues surrounding competition. Its aim is to help expand the risk appetite of existing insurers and explore opportunities for new market entrants in order to increase the availability of insurance.
Furthermore, the Department is also working closely with the IDA to encourage new entrants into the insurance market so as to improve its overall competitiveness. Officials from both are developing a customised proposal and are identifying potential providers who offer insurance in identified ‘pinch-points’ segments of the Irish market. This includes those coverage areas impacting businesses, consumers and community and voluntary groups.
Finally, I would like to take this opportunity to assure the Deputy that securing a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland remains a key policy priority for this Government. In this regard, it is my intention to work with my Government colleagues to ensure that implementation of the Action Plan can have a positive impact on the affordability and availability of insurance across all sectors in the economy including the critical childcare sector.