Vol. 407 No. 4
14 Mr. Durkan asked the Minister for Industry and Commerce the number of applications for motor cover received by the various insurance companies in 1990; the comparable figure for 1980; the number of rejected applications for insurance for the years in question; the cost of claims in respect of same; and if he will make a statement on the matter.
The particulars requested by the Deputy relate to the day-to-day operations of individual companies and data is not available to my Department which would enable me to provide the information sought.
I would like to remind the Deputy of what I have said in this House on numerous occasions, in that, as the insurance supervisory authority I have a responsibility to ensure that insurance companies are in a position to meet their statutory solvency and reserve requirements but this does not extend to the detailed management of their affairs. Therefore, I must respect the right of insurance companies to make their own underwriting decisions, including the acceptance or rejection of any risk, in the light of their circumstances and assessment of the market. No legal obligation can be placed on any insurer to quote in respect of any risk or to quote at any particular premium. However, cases of difficulty in obtaining motor insurance can be referred to the Declined Cases Committee of the Irish Insurance Federation.
Does the Minister accept that one of the problems that assails the young motorist in particular is that the Minister's Department are not getting sufficiently involved and are not monitoring on a regular basis the activities of all parties — claimants and motor insurers? Would the Minister not accept that a more rigid appraisal of developments on a daily or weekly basis would bring about some benefits to those seeking insurance cover?
The insurance section of my Department are well informed about developments in insurance. The nub of the problem is that the Deputy really wants the Department to get involved in individual cases, to as it were, sit on insurance companies on a weekly basis. That is not feasible and it is very much at odds with what his colleague Deputy Barry has been saying to me here in the last few minutes. It is undesirable and it is not feasible. There are constant meetings with the Irish Insurance Federation, where many points are made repeatedly and where our urgings in this respect are being taken on board by the companies.
The Minister misunderstood my supplementary. Would the Minister not accept that the dangerous and unfortunate trend of escalating insurance costs which have surfaced over the last ten years should not be allowed to continue and that the Minister's reply to the question would lead people, particularly insurance companies and those who made fraudulent claims, to the conclusion that the Department are not very interested? Would the Minister not also agree that if his Department showed a more urgent interest in what was taking place it might become a signal for a change in attitude?
I told the Deputy in reply to a supplementary to an earlier question that over a year ago I and the Department brought the attention of companies to what I believed was a growing incidence of fraudulent claims. Unfortunately, they did not have the statistics I wished they had. I asked them to get those statistics and to set up structures which would enable them to have those statistics. I pointed out that that would be the most effective way of putting a stop to these fraudulent claims, or certainly diminishing them. The incidence of fraudulent claims is now beginning to drop but it was and probably still is a serious matter in this country. They are utterly dishonest and disreputable and I deplore the fact that they go on because they contribute in a way which must be of some significance to the high level of costs and, therefore, premiums.
Deputy Jim Higgins and Deputy Jimmy Deenihan have been offering. I will take a brief question from the two Deputies.
Would the Minister acknowledge that the vast majority of young drivers cannot even get a quotation and that the vast majority of insurance companies will not touch young drivers? In view of the fact that the one or two companies who give a quotation will charge up to £2,000 for first time insurance, would the Minister consider introducing a quota system so that the liability would be spread among the various companies?
I do not think it is correct to say that it is impossible for any driver to get a quotation. They do get quotations but they get them at figures which are way beyond their means, and effectively for an individual that may amount to the same thing. I have had intensive discussions with the insurance companies on this matter and we have looked at different ways of approaching the problem. In particular the Government have taken what I think is a very useful initiative in setting up a sub-committee, which I have announced already, consisting of myself as chairman, the Minister for Justice, the Minister for the Environment and the Attorney General to look at substantial ways in which different aspects of our laws could be changed to bring down the costs of motor accidents and their consequences as they are so inordinately high in comparison with other countries as a result of which premiums are inordinately high. Our court system, as opposed to the systems in other countries, must be a significant factor, that is one of the issues under consideration.
Is the Minister aware that a number of young people have had to forfeit job opportunities because of their in ability to obtain cover? Would he outline some of the measures, apart from those mentioned already, taken by his Department to tackle the prohibitive cost of insurance for young drivers, especially those who hold provisional licences?
We have had most of these questions already.
A long list of matters are being considered by the sub-committee. Many of them have already been agreed and will be put to the Government during the next month or two. If the Government accept them they will be implemented as speedily as possible. They are wide ranging in terms of changes in road traffic law and enforcement and in the method of assessment of damages in the civil system in the courts and many other matters. The Deputy will appreciate that I would not wish to go into detail until they have been accepted by the Government and they have given a formal decision to legislate along those lines.
A final question from Deputy Barry.
I have a question on the Order Paper about this matter. Would the Minister comment on a suggestion made to me that if the insurance companies separated third party claims from comprehensive and third party, fire and theft claims the cost of third party insurance would be much lower? I do not know if there is any merit in that suggestion.
That is a separate question which is further down the list and which may not be reached.
Question No. 33.
I cannot put my finger on it now as I am not sure of the number——
It is Question No. 33 and we ought not anticipate that question.
The answer I will give, if we reach it, is that companies do separate the relative costs of the different policies. The reason comprehensive insurance costs more than third party insurance is that the amounts paid out, on average, on a comprehensive policy are substantially more——
They are levelled over the whole lot.
They are not. The insurance companies have assured us that they are not levelled or averaged in that way.
Let us now come to deal with Deputy Barry's question.
May I ask one final supplementary?
The Deputy has had a good innings on this question. Question No. 15, please.
May I ask one final supplementary?
