asked the Minister for Industry and Commerce if he is aware of the prohibitive cost of public liability insurance and the extreme difficulties many companies are experiencing in meeting these payments; and the steps he proposes to take to alleviate the problem.
Written Answers. - Public Liability Insurance.
21.
Limerick East): As the Deputy will be aware, I am the regulatory authority for the insurance industry and my primary responsibility is to ensure the solvency of the insurance companies operating in the State.
I am aware of the high cost of public liability insurance and the difficulties many companies face because of these costs. This situation has evolved from the heavy losses experienced by insurance companies on their liability accounts — losses which in 1983 amounted to nearly £36 million on an income of £52 million. Faced with losses of this magnitude insurers have increased premium rates generally, and have become increasingly cautious about the type of risk they will accept.
The high cost of liability insurance is directly related to the high cost of claims. The Government is taking action on a number of fronts to reduce the number and cost of claims. The Minister for Labour has established a board to promote better safety practices in the work-place. Fewer accidents will, of course, result in fewer claims.
In addition the present jury system of determining awards has given rise to excessive and unpredictable awards, leading ultimately to increased premium costs. The Government recently announced its decision that in future High Court actions for personal injuries arising from negligence will be decided by a judge sitting alone without a jury. The Minister for Justice has published a Bill to give effect to this decision.
Arising from the difficulties in the market at the present time, I have made an arrangement with the Irish Insurance Federation whereby any company which is having difficulty in obtaining a quotation, may have its case referred to the federation.
I am hopeful that these measures and others under consideration at present will lead to stabilisation in claims costs and easier market conditions.