Michael Ring
Question:120 Mr. Ring asked the Tánaiste and Minister for Enterprise, Trade and Employment her plans to investigate and stop the increasing costs of insurance, particularly for small businesses. [3183/02]
Written Answers. - Insurance Industry.
I am very much aware of the substantial increases in insurance premiums that many firms are facing and of the problems that this is creating for them.
The pricing and underwriting of insurance is, however, a matter for individual insurance companies. EU law prevents us from intervening in relation to the matter of premium levels or in respect of what risks they are prepared to underwrite. Insurers make decisions on provision of cover based on their assessment of that particular risk.
The insurance industry has pointed to a number of factors, both domestic and international, to explain these increases. These include the high cost of settling claims in Ireland, the general reduction in investment returns, recent court decisions regarding the calculation of compen sation losses in personal injury cases and the effects of the 11 September attacks in the United States. The situation has not been helped by the failure of the UK authorised insurer, Independent Insurance Company Limited, which had a significant presence in the Irish market for the past seven years.
An interdepartmental implementation group is progressing the establishment of the personal injuries assessment board. I am confident that the establishment of the PIAB will achieve a reduction in the delivery costs of personal injury compensation, thus permitting a reduction in insurance costs to consumers.
A workplace safety group has been established with a view to improving health and safety standards in the workplace. The objectives are to reduce workplace accidents, to encourage injured workers to return at the earliest possible date to the workplace and to improve claims handling procedures, thus reducing insurance costs. The group is developing proposals at present designed to bring the initiative to small and medium sized firms.
I would encourage consumers and insurers to consider ways of reducing the worst effects of the current circumstances, for example by better management of risks, examination of excess covers and whether the full extent of the covers included in policies is actually required by all individual businesses.