Dáil Éireann Debate, Wednesday - 17 April 2019
99. Deputy Bernard J. Durkan asked the Minister for Finance the extent to which he continues to monitor activities in the insurance industry with particular reference to arresting the upward spiral of premiums; and if he will make a statement on the matter. [18036/19]
View answerI am very conscious of the difficulties that increased insurance costs generally are having on many consumers, voluntary organisation and small businesses in this country. That is why the completion of the Cost of Insurance Working Group’s (CIWG) work remains very important in order to fully achieve its objectives of delivering fairer premiums for consumers and businesses, and a more stable and competitive insurance market.
In this regard, I believe that significant progress has been made on the motor side which is reflected in the fact that the most recent Central Statistics Office data indicates that the cost of motor insurance has fallen by 23.8% since July 2016. Consequently the average consumer should be seeing reductions when renewing their motor insurance.
In relation to the Report on the Cost of Employer and Public Liability Insurance, the CIWG’s most recent quarterly Progress Update on the implementation of its recommendations indicated that 24 out of the total of 26 action points which were due for completion during 2018 overall have been accomplished. This Progress Update also included an additional section providing the up-to-date status in respect of relevant recommendations from the two reports issued by the Personal Injuries Commission (PIC).
The Deputy will be aware that the PIC reported in September 2018 and concluded that soft tissue injuries are significantly higher here than in England and Wales (4.4 times) and recommended that action be taken to address this disparity through the establishment of the Judicial Council. The PIC recommended that this body would become responsible for preparing the guidelines on personal injury award levels, and would replace the Book of Quantum.
While the Working Group will continue to focus on implementing all of its recommendations, I consider that bringing the levels of damages awarded in this country more in line with those awarded in other jurisdictions is undoubtedly the single most essential challenge which must be overcome if there is to be a sustainable reduction in insurance costs. The current position with the Judicial Council Bill is that the Minister for Justice and Equality has indicated that he hopes that the Bill will be enacted by the summer. In this regard, it recently completed Committee Stage in the Seanad. Alongside this, the Law Reform Commission has included the subject of capping damages in personal injuries litigation in its draft 5th Programme of Law Reform and this work will begin shortly.
Finally, I expect that insurers’ pricing of premiums in general will take account of the measures which have been, and are being, implemented as a result of the CIWG recommendations more broadly and I believe that insurers themselves recognise this. In this regard, I would recall that Justice Nicholas Kearns, the Chairperson of the Personal Injuries Commission (PIC), noted in the foreword of its second report that insurance industry representatives on the PIC repeatedly stated that, as award levels and associated costs account for the bulk of the cost of insurance, if claims costs come down and are maintained at a consistent and predictable level, then premiums will also reduce accordingly. A further public statement by insurers to this effect would assist in efforts to continue the necessary reform.
