Jim O'Keeffe
Question:137 Mr. J. O'Keeffe asked the Tánaiste and Minister for Enterprise, Trade and Employment her views on whether increases in insurance premia are exorbitant; and her proposals in this regard. [28756/01]
Written Answers. - Insurance Industry.
We are fully aware that insurance costs have increased dramatically during this past year. The insurance industry has pointed to a number of factors, both domestic and international, to explain these increases. These include High Court decisions that required insurers to strengthen reserves, for claims arising in past years and the global impact of 11 September on international insurers and reinsurers. Under EU law, we cannot intervene in matters of pricing or underwriting of insurance.
The Motor Insurance Advisory Board is due to report to me at the end of this year on a number of matters pertaining to motor insurance, including the reasons for the high cost of motor insurance. Research has shown that insurance premiums are high in Ireland because compensation awards are high. Compensation for loss of income and for medical expenses arising from personal injury is paid for through the private insurance system rather than through the social welfare and health systems, as in other European countries.
Of the total cost of claims, the costs of delivery of compensation runs at approximately 40%. The objective of the proposed personal injuries assessment board is to reduce these latter costs, so that insurance costs may also be reduced. The implementation group is expected to report at the end of the year, as to how the PIAB may be put into operation.
Question No. 138 answered with Question No. 99.