(Dublin North-West) asked the Minister for Industry, Trade, Commerce and Tourism if he is aware of the very high premiums that are now being charged in cities and provincial towns for householders' insurance; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Household Insurance.
4.
I am aware of the premium rates charged for household insurance which reflect the risks borne by insurers on this class of business. Recent increases in these rates have arisen from the substantial losses on household insurance in recent years which must be provided for. Because of my concern at the effect on the public, I have insisted that these increases be limited or moderated where it is open to me to so do and in a prudent manner.
I should like to pose one or two questions on this important matter that affects every householder. Is the Minister aware that in the past six months increases in this type of insurance have been between 50 per cent and 100 per cent, all granted by the NPC? Is the Minister aware that this is having a detrimental effect on family budgets and that household insurance is now almost as dear as car insurance? Has the Minister any hope to offer to the people concerned?
I am sure the Deputy realises that my function is primarily as a supervisory authority. I must ensure, as the Deputy will appreciate, that insurance companies remain viable. I should like to point out that in recent years there has been a serious underwriting loss in this class of business under the heading of fire and other damage to property. For instance, the underwriting losses deteriorated from £75 million in 1981 to £10.693 million in 1983 and £12.154 million in 1984. Obviously, that represents a serious loss. The main reason for those underwriting losses has been the significant increase in crime and the frequency of claims. I suggest that the increase in the crime rate has been substantially responsible for those underwriting losses.
The Minister cannot pass this off by saying he does not have any responsibility except in so far as the supervision of companies is concerned. Is the Minister aware that a burglary occurs every 20 minutes and that he cannot treat this matter in isolation by telling us it is the responsibility of another Minister? If, as a result of a burglary occurring every 20 minutes, householders have to pay exorbitant insurance premiums, has he any suggestion to put forward to deal with the problem?
Clearly this is a matter for another Minister.
It is very much related.
Has any insurance company operating here written to the Minister requesting permission to withdraw the comprehensive insurance on contents for certain parts of the country? Has the Minister received any notification verbal or in writing on that matter?
That is a cryptic question, but if the Deputy gives me details of the case involved I will discuss the matter with him.
This seems to be a separate question. The question before the House is about the rate of premiums and not the availability of insurance.
It is all connected. I want the Minister to answer "yes" or "no" because I am aware that he sees the correspondence that goes through his office.
I am not aware of a particular company because the Deputy has not specified the company involved.
I will specify the company.
If the Deputy wishes to discuss the matter with me I will be pleased to do so. I am satisfied that insurance cover is available for householders. I should like to inform Deputies that the average rate currently applying in the Dublin area is .7 per cent of a pound while in the rest of the country it ranges from .3 per cent to .45 per cent of a pound. There is a clear reflection in the amount charged on the level of crime in Dublin and the rest of the country.
Will the Minister agree that some of the companies are showing a profit and will he ensure that those companies do not increase their premiums?
The Deputy can be assured that it is not my wish to prevent insurance companies from making a profit, but it is not my wish that they should make super profits. It is in order to ensure in the public interest that does not occur that I have legal powers in regard to allowing price increases. The Deputy can be assured that the criteria I adopt were established in the Department a number of years ago and allow a balance where possible for underwriting under the various headings of insurance cover. This well established practice allows us to carry out a clear examination of the underwriting experience and gives an indication of how the trend is in the market place.
The Chair has an absolute discretion as to the number of supplementaries that should be asked. In view of the number of Members now offering I have come to the conclusion that I would be guilty of a clear dereliction of duty if I did not pass to the next question and I propose to do so.
I disagree with that ruling. This is an important matter and I want to put a simple question to the Minister.
I have been generous on this question, but I am going to take a stand now.
Have insurance companies withdrawn cover? The answer is that they have.
Companies are refusing to grant cover.