Dáil Éireann Debate, Thursday - 7 October 2004
37 Mr. Sargent asked the Minister for Enterprise, Trade and Employment his plans to address the unaffordability of car and motorcycle insurance for young drivers especially in view of the impediment such exorbitant rates place on taking up certain types of employment and the reduction in other insurance premiums over the last year. [23602/04]
View answer50 Mr. Crowe asked the Minister for Enterprise, Trade and Employment the measures he proposes to introduce to lower insurance costs for both businesses and motorists; when such measures will be introduced; and if he will make a statement on the matter. [23610/04]
View answerI propose to take Questions Nos. 37 and 50 together.
Following the establishment of the Irish Financial Services Regulatory Authority and the coming to an end of my Department's lead role in the insurance reform programme, my colleague, the Minister for Finance, retains overall responsibility for policy and legislation in relation to the provision of financial services in Ireland. My colleague, the Minister for Transport, in the light of broader responsibility for road safety, will take over the lead role in relation to policy and legislation on the availability and cost of motor insurance and any related interdepartmental co-ordination. The transfer of responsibilities to my colleague, the Minister for Transport, has been agreed and will be activated shortly following the completion of logistical issues relating to the transfer of an agreed number of posts from my Department to the Department of Transport.
My Department has put in place the following measures to improve the functioning of the insurance market and which, I believe, will lead to a reduction in insurance costs to the benefit of businesses and motorists alike.
S.I. No. 389 of 2002, Motor Insurance (Provision of Information) (Renewal of Policy of Insurance) Regulations 2002, requires that insurance companies provide motor insurance policy holders with the terms upon which renewal is offered and their no claims bonus documents a minimum of 15 days before the end of their current policy. This allows consumers sufficienttime to shop around before renewing their policies.
My Department and the Competition Authority have undertaken a joint study into the insurance market. The study will identify and analyse barriers to entry and limitations on rivalry in the insurance marketplace. The bulk of the study was completed in 2003 and a preliminary report and consultation document on competition issues in the non-life insurance market was published on 18 February 2004. Following consultation, a final report will be published later in the year which will contain recommendations based on the findings.
A key initiative in my Department was the establishment of the Personal Injuries Assessment Board. By eliminating the need for litigation costs where legal issues are not in dispute, the PIAB will significantly reduce the cost of delivering compensation. The PIAB will also offer speedier assessments to the benefit of claimants.
A book of quantum, an aid for assessing the level of compensation based on the type of injury involved, which is essential for the successful operation of the PIAB, was published by PIAB on June 2004. Significant initiatives are also being pursued by my colleagues, the Minister for Transport and the Minister for Justice, Equality and Law Reform, and by IFSRA, under the aegis of the Department of Finance.
Indications to date are that the cost of insurance is falling. The CSO publishes monthly indices of costs for a number of classes of insurance. These statistics show that there was a reduction of 15.2 index points, 14.1%, in motor car insurance between the months of April 2003 and August 2004, which is the latest figure available.
