Written answers

Thursday, 4 July 2024

Department of Finance

Insurance Industry

Photo of Ruairi Ó MurchúRuairi Ó Murchú (Louth, Sinn Fein)
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96. To ask the Minister for Finance to provide an update on the work of the Office for the Promotion of Competition in the Insurance Market, particularly in relation to reducing the cost of public liability insurance; and if he will make a statement on the matter. [28015/24]

Photo of Jack ChambersJack Chambers (Dublin West, Fianna Fail)
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The Government remains committed to addressing the issue of high cost of insurance, including for public liability cover, through the efforts of the Office for the Promotion of Competition in the Insurance Market, a key element of the Action Plan for Insurance Reform. Established as a Programme for Government commitment and overseen by the Minister of State at the Department of Finance, the Office aims to expand the risk appetite of existing insurers and attract new market entrants. By maintaining regular contact with sectors facing insurance difficulties, the Office plays a pivotal role in helping to encourage the availability of insurance cover including for various high-risk activities, including equestrian activities, inflatable hire, and ice-skating.

Through leveraging the Government's insurance reform agenda, the Office has successfully helped facilitate the availability of insurance in previously challenging areas, in turn contributing to a more competitive market. This collaborative approach involves connecting groups facing insurance challenges with relevant stakeholders and separately engaging with IDA Ireland to help attract new insurers to the Irish market. Most recently we have seen OUTsurance commence operations here. In terms of business and commercial insurance, existing providers have indicated that they are expanding their risk appetite to underserved areas and various sectors are reporting reductions in the rate being charged for liability cover.

The broader Action Plan for Insurance Reform, a critical government initiative, is progressing well. Overseen by a Cabinet Committee Sub-Group on Insurance Reform, chaired by the Tánaiste, the plan has seen significant progress, with most actions either delivered or initiated. This coordinated whole-of-Government approach aims to improve the domestic operating environment for insurers, despite the EU level Solvency II framework, which prevents Government from compelling insurers to provide coverage or dictating pricing.

Significant achievements under the Action Plan include amendments to the Occupier’s Liability Act 1995, reform of the Injuries Resolution Board, and the introduction of new Personal Injuries Guidelines, which have reduced award levels by an average of 35% when compared to 2020. Additionally, the establishment of the Insurance Fraud Coordination Office and the introduction of the Criminal Justice (Perjury and Related Offences) Act 2021 are pivotal steps in combating insurance fraud and ensuring a fairer claims environment.

The Government recognizes the importance of the insurance industry in supporting these reforms by challenging frivolous claims, adhering to new award guidelines, and promoting the Injuries Resolution Board. It is essential to understand the cyclical nature of insurance and the impact of international pressures on the market here. Accordingly, Ireland's reforms are designed to create a more competitive environment, attracting international capital despite limited influence over global trends.

In conclusion, the Government remains steadfast in its commitment to achieving a competitive and sustainable insurance market, ensuring the availability and affordability of insurance for all sectors. The ongoing implementation of the Action Plan for Insurance Reform, along with the work of the Office for the Promotion of Competition in the Insurance Market, continues to deliver on the Government's reform agenda, making Ireland a more attractive destination for insurers and ultimately benefiting consumers.

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