Michael Creed (Cork North West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

211. To ask the Minister for Finance the engagement he has had in recent times with an organisation (details supplied) in connection with affordable insurance for the sector to facilitate its calendar of events in 2023; and if he will make a statement on the matter. [8794/23]

Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

This Government recognises the fact that a number of outdoor/high-footfall activity sectors, including motorcycle sports, are currently facing difficulty in terms of affordability and availability of insurance. It has therefore prioritised the implementation of the Action Plan for Insurance Reform, which aims to improve the cost and availability of insurance for all groups, including sporting organisations. The latest Implementation Report, published in November 2022, demonstrates that significant progress has been achieved, with approximately 90 percent of the actions either delivered or ongoing.

One of the most significant developments has been the implementation of the Personal Injuries Guidelines, which have reduced average award levels by nearly 40 per cent. Government has consistently emphasised its clear expectation that insurers should pass on any savings arising from the reform agenda to customers. Minister of State Carroll MacNeill is meeting with the main insurers in the Irish market this month and will impress upon them the need to reflect lower claims costs through reduced premiums, but also to expand their risk appetite to provide cover to lesser-served, ‘pinch-point’ sectors, such as motorsports.

Work remains ongoing on a whole-of Government basis to ensure the timely implementation of the remaining elements of the Action Plan. Of particular relevance are the proposed amendments to the duty of care legislation. The policy intent is that these measures will have a significant impact on the issue of slips, trips and falls, and thus should assist the sporting and outdoor activity sector as a whole.

In conclusion, 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. It is therefore my intention to work with my Government colleagues to ensure that the implementation of the Action Planwill continue to have a positive impact on the affordability and availability of insurance for all groups, including sporting clubs and organisations.

Ivana Bacik (Dublin Bay South, Labour)
Link to this: Individually | In context | Oireachtas source

212. To ask the Minister for Finance his plans to reform flood insurance here; if he will make a statement on insurance cover for persons living in areas with demountable flood defences; and his views on legislating for compulsory insurance cover for those living in areas which are prone to flooding. [8062/23]

Michael McGrath (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

As Minister for Finance, I have policy responsibility for the development of the legal framework governing financial services regulation, including for the insurance sector. Within this context, it should be noted that the provision of insurance cover and the price at which it is offered is a commercial matter for insurance companies providing the service and is based on an assessment of the risks that such companies are willing to accept. Therefore, under the EU Solvency II Directive, neither I, as the Minister for Finance, nor the Central Bank of Ireland can compel insurers to provide such cover.

Government policy in relation to flooding focuses on the development of a sustainable, planned and risk-based approach to dealing with flooding problems. To achieve this there is a focus on -

- significant investment by the Government of €1.3 billion to manage Ireland’s flood risk over the lifetime of the National Development Plan to 2030, with flood relief measures implemented by the Office of Public Works (OPW) and relevant local authorities, and,

- maintaining channels of communication between the OPW and the insurance industry, in order to reach a better understanding about the provision of flood cover in affected areas.

Alternative flood insurance models have been considered by the Department of Finance its review of policy in relation to flood insurance in 2016, and the ‘Public Consultation on Climate Change and Insurance’in 2019. It was found that alternative approaches, including legislating for compulsory cover would have limited impact on the availability of flood cover. Mandating the provision of flood cover would result in, amongst other things: an increase in premia for all property insurance policies; the risk that insurers decide to withdraw from the market and the potential contravention of EU rules.

In terms of the outcome of the current approach to flood insurance, it should be noted that both industry and Central Bank of Ireland surveys indicate there has been an overall increase in the provision of flood insurance over the last number of years. However, it is acknowledged that some households are still experiencing difficulties, particularly in areas with demountable flood defences which require varying degrees of human intervention in their installation.

In order to address the issue of flood coverage levels in areas with demountable defences, continued engagement with all relevant stakeholders is key. This is facilitated as part of the Memorandum of Understanding (MoU) between the OPW and Insurance Ireland. Under this arrangement, the OPW provide information on all completed flood defence schemes to Insurance Ireland, including on demountable ones. In turn, its members take into account all of this information when assessing exposure to flood risk within these areas. Officials from the Departments of Finance; Housing and Local Government, along with other stakeholders engage constructively with this process on how the levels of insurance cover might be improved in areas where flood defence works have been completed.

Finally, as has been the case, my Department will continue to monitor and assess any flood insurance matters, including through: its participation in the OPW and Insurance Ireland Working Group; actively encourage industry to have a more responsive approach to the matter; engage with the Central Bank of Ireland; and consider domestic and international policy developments to these issues as they arise.

I and Minister of State Carroll MacNeill, along with our officials, will continue to engage on all aspects of insurance reform, including flood cover issues. These matters are a priority for this Government and efforts continue to be made to encourage a responsive approach from the insurance industry.