Vol. 514 No. 1
51 Mr. Broughan asked the Tánaiste and Minister for Enterprise, Trade and Employment when she will introduce the promised regulations to introduce greater transparency in the sale of insurance products; and if she will make a statement on the matter. [3492/00]
Regulations to introduce greater transparency in the sale of insurance products will be introduced by me as soon as practicable following enactment of the Insurance Bill, 1999, which was published in December last and will come before the Dáil and Seanad shortly. Legal advice suggested to us that, without the firm legal basis the Insurance Bill will provide, disclosure regulations would have been vulnerable to constitutional challenge.
The Bill contains, inter alia, enabling measures which will allow me to introduce policyholder information requirements at both point of sale and on an ongoing basis in respect of both life and non-life insurance. The disclosure regulations related to the sale of life assurance products will be introduced first. The objectives of the new disclosure regime for life assurance will be to simplify the presentation of insurance products to the consumer by the disclosure of relevant and appropriate information on the policy by the broker-intermediary or insurance company representative; minimise the scope for misselling, including “churning” of policies; and ensure transparency of all charges and expenses and also commission payments.
In drafting the disclosure regulations on life assurance policies, prior extensive consultations with interested parties were engaged in by the officials in our Department. A similar extensive and comprehensive consultation process will be adopted in respect of the non-life regulations. However, the precise format cannot be finalised until after the final enactment of the Insurance Bill.
I hope the Minister of State does not tell me this is a complex issue.
It certainly is or the Deputy would have dealt with it.
Is it not a fact that three years ago the proposals for disclosure were with the industry and being commented upon by it, that the general direction was approved and that there was no question of any constitutional challenge? Why does the Minister of State tell the House three years later that he will implement it as soon as practicable? Why does he not tell the House that, after coming into office, he made a public statement that he would not proceed with the disclosure requirements and that he has only recently been dragged kicking and screaming to the notion of disclosure? Why did the question of a statutory basis to permit this to happen never arise when I was in his position?
It is an absolute negative by Deputy Rabbitte to say these disclosure proposals existed in the Department three years ago. He was two and a quarter years in my position and chose not to deal with the issue. I inherited a situation where we had to start from scratch and develop the matter. What I said—
The proposals were with both sides of the industry.
I am answering the question.
Allow the Minister of State to answer.
I made a statement some time ago that I could not proceed with disclosure regulations because the legal advice available to me was that it was not legally possible to do so. I am guided by legal advice in my job and I accepted that legal advice. To ensure we could proceed, we drafted primary legislation, namely, the Insurance Bill, 1999, which was published and will be debated next month in this House and in the Seanad. When it is passed, we will then proceed with the regulations and they will be transparent, sustainable, acceptable to both consumers and the industry, practical, operable and sensible.
The time for questions is concluded but given that Deputy Creed has been in the House all afternoon, I will call his question. I know we are going beyond time, but he has been in the House all afternoon.
We will return to the discussion another day.
I will give way to Deputy Creed, but I must say the Minister of State is rewriting history and we will return to that.
The Deputy did not create it.
It is 4.15 p.m. and the time for questions is over. As Deputy Creed was in the House all afternoon, I will take the reply to his question and one supplementary question.
