Vol. 397 No. 9
163 Mr. J. Bruton asked the Minister for Industry and Commerce if his attention has been drawn to the fact that there is only one insurance company offering cover for public liability for fun fairs; his views on whether this is satisfactory from the point of view of competition; and whether the present level of premium being charged for fun fairs is reasonable in the light of the risks involved.
There are 24 insurance companies authorised to underwrite liability insurance, including public liability for activities such as fun fairs, in Ireland.
The cost of any type of insurance is directly and substantially dependent on the frequency and level of claims. I understand that insurers view public liability insurance for fun fairs as being high risk due to the claims experience they have had on this type of business. Over the past number of years insurers have suffered large underwriting losses on their liability accounts. These losses amounted to £18 million in both 1987 and 1988. Faced with these losses insurers have had to exercise more selectivity in the type of risk undertaken.
I understand that one insurer is providing policies covering public liability risks for fun fairs. I am informed that insurers other than the one mentioned may offer quotes depending on the circumstances of a particular risk. From a competition perspective it would, of course, be preferable if there was a wider choice of public liability insurance for fun fairs available.
However, as the insurance supervisory authority, my primary and indeed statutory duty is to ensure that insurance companies maintain their statutory reserves and solvency requirements. The acceptance or rejection of any type of risk is a matter for each individual insurance company to decide in the light of their underwriting experience. No obligation can be placed on an insurer to quote in respect of a particular risk or to quote at any particular premium.
I would add that an arrangement exists with the Irish Insurance Federation to assist in cases where difficulties are experienced in obtaining liability insurance. Before any case can be referred to the federation, it is necessary that at least half the market be approached without success. Evidence of these approaches e.g. a letter from a broker together with a brief synopsis of the risk should be forwarded to the insurance section of my Department who will refer the matter to the federation.
