Vol. 248 No. 11
asked the Minister for Industry and Commerce if he is aware of the chaotic condition in motor insurance offices in this country because of (a) the refusal of many companies to take new business and (b) the attempts of many companies to make very high charges for renewals; and if he will make a statement on the matter.
40.
asked the Minister for Industry and Commerce if, in view of the fact that vehicle insurance is compulsory in this country, he will introduce a system of State motor insurance.
41.
asked the Minister for Industry and Commerce if it is permissible for insurance companies to raise their rates above the increases recently allowed by him; and if he will make a statement on the matter.
With your permission, a Cheann Comhairle, I propose to take Questions Nos. 39, 40 and 41 together.
I am aware that some companies are reluctant to provide motor insurance for persons not previously insured, but I am not aware of any instance of failure to secure cover in the market. There is machinery available under the auspices of the Minister for Local Government for dealing with cases of individual drivers who find difficulty in securing cover.
Under their agreement with me, the companies are not free to increase the basic rates by more than 17½ per cent. Where instances involving a possible breach of the arrangements governing control of premium rates have been brought to my attention, I have had the matter taken up with the companies concerned. I must, however, accept the right of the companies to apply reasonable additional loadings on the basic rate on renewal where there has been an increase in risk.
It would be premature to consider the possibility of a system of State motor insurance in advance of the report of the committee which I am setting up to look into the insurance industry.
Is the Minister not aware that at present middle-aged or elderly persons who have not previously held insurance, although possibly driving motor vehicles all their lives, if they attempt to get cover cannot do so? Is he aware that insurance companies are, on renewal of policies, adding clauses in the form of a typed or printed notice on the back of the policy saying that under-30 drivers are not covered. If the insurance company has a query they will increase the price on the ground that there is a big increase in risk although under-20 drivers have previously been covered by the same company? Is the Minister aware that one particular insurance company, the PMPA, have made it widely known that they are prepared to accept practically everybody, and as a result, they have a queue which takes about four hours to clear and that every day there are people who, after waiting hours, are not dealt with? Having reached that stage would the Minister not agree that the next stage is to have a considerable number of uninsured drivers? Would the Minister investigate the matter to see if something can be done before the position gets completely out of hand? I am not making it awkward for the Minister but I am giving him information of which he may not be aware.
That is a very long question.
It is a very long story.
It is a long statement rather than a question. The Deputy has given me an account of queues. That is the first I have heard of queues in this regard. I was not aware of the effort at swing-over. As I said in the reply, where there is additional risk there is a question of additional loading. Certainly, in any investigations I have conducted, where the risk is the same as it was, I find the insurance companies have not increased the premiums charged apart from the 17½ per cent.
What about the change in regard to over-30 drivers? I have asked the Minister a question and I should like him to be allowed to answer it because it is a serious matter. The Minister for Justice will have a good deal to do with this matter if it is not cleared up quickly. Does the Minister consider it right that insurance companies should, on a policy that has been in operation for years, provide that under-30 drivers are not allowed to drive without special risk coverage?
I am covering three replies here.
I did not ask the Minister to cover the three together. I tabled three separate questions.
Agreed, but in none of those replies is there any reference to the question of under 21 to 30 drivers. I must insist that this is a separate issue. Apart from that, as I have stated in the final paragraph of my reply, this whole question will be examined by this committee I am setting up.
When?
I expect to announce the composition of the committee before the end of this month.
In regard to the reply to No. 41, am I to take it that, in the case of an accident-free insuree, it is an illegal act for the insurance company to raise the premium over and above the allowable amount, which I understand is 17½ per cent?
For any cover which existed up to now it is wrong for any insurance company to increase it.
Is it illegal in the case of an accident-free driver to raise it above the allowable amount?
It would be illegal if there was no additional risk being covered. If I had a case where there was no additional risk being covered and where the premium went up over 17½ per cent, I should like to hear about it from the Deputy.
It is an illegal act?
Yes.
If what the Minister has said is published in the newspapers he will have all the letters he wants before the end of the week.
The Minister said he is not aware of a case of refusal of cover. Is he not aware of cases of refusal of temporary cover pending the renewal form being filled up? Is he not aware that not long ago I myself had to leave my car in this House because I could not get cover to drive home to fill up the form and only got cover because his personal secretary intervened?
I met the Deputy in the corridor and would look upon him as a risk.
If the insurance policy is terminated today and the person who considers he has a fortnight to renew it does not renew it until tomorrow, he will find it is a new policy and he must pay new rates and he is not covered until it is issued.
Is the Minister aware that there is apparently an agreement among companies that if you have a claim against your own company another company will not take you, so you are forced to renew your policy with your own company regardless of the rate they charge?
We have gone well over the time.
It is because of this overall problem that I decided to set up this committee.
What is the delay in establishing it? It has been promised for a long time.
Not very long. It was promised about a month ago, but I was anxious to work out terms of reference and the composition of the committee. There are so many facets involved in this and, as I have said, I was anxious to ask this committee to let me have an early report in connection with the motor industry. It is not something I can do within a week or a fortnight. If I get the committee set up by the end of this month and give them adequate terms of reference I think I will not have delayed the matter too long.
I take it the terms of reference will be wide enough to cover——
To cover overall insurance, with special reference to getting an early report in connection with the motor industry.
The remaining questions will appear on tomorrow's Order Paper.
