I am aware of particular cases whereby there have been increases in insurance premiums affecting particular special needs schools. The Deputy will appreciate however that I am not able to comment on individual cases, as there may be factors relating to the case that I am not privy to, such as a change in the insurance policy that has led to an increase in the price, the existence of open claims, an increase in the level of claims in this general sector, etc.
That said, both I and the Minister of State for Financial Services and Insurance, Mr. Michael D’Arcy T.D., are very conscious of the difficulties that the cost and availability of insurance are having on many organisations such as businesses and community groups in this country. The Deputy should note that there is no policy or legislative ‘silver bullet’ to decrease the cost of insurance. This was also recognised by the Joint Oireachtas Committee on Finance and Public Reform, who reported on the issue in late 2016. This is a complex issue because for constitutional reasons the Government cannot direct the courts as to the award levels that should be applied and for legal reasons it cannot direct insurance companies as to the pricing level which they should apply in respect of businesses seeking insurance, as these matters are of a commercial nature, and are determined by insurance companies based on the risks they are willing to accept.
Notwithstanding this, I wish to reemphasise how important this issue is for the Government. Consequently, following the publication of its Report on the Cost of Motor Insurance in 2017, the Cost of Insurance Working Group undertook an examination of the employer liability and public liability insurance sectors. This second phase culminated in the publication in January 2018 of the Report on the Cost of Employer and Public Liability Insurance. Much work has been done to date through the implementation of both reports of the Cost of Insurance Working Group and achievements to date include:
- the establishment of the Personal Injuries Commission, and its subsequent recommendations relating to addressing award levels for soft tissue injuries;
- the Law Reform Commission (LRC) has commenced its work to undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries, as part of its Fifth Programme of Law Reform;
- increasing transparency around the cost of private motor insurance through the establishment of the National Claims Information Database in the Central Bank;
- reforms to the Personal Injuries Assessment Board through the Personal Injuries Assessment Board (Amendment) Act 2019;
- amendments to Sections 8 and 14 of the Civil Liability and Courts Act 2004 to make it easier for businesses and insurers to challenge cases where fraud or exaggeration is suspected;
- the reform of the Insurance Compensation Fund to provide certainty to policyholders and insurers;
- various reforms of how fraud is reported to and dealt with by An Garda Síochána, including increased co-ordination with the insurance industry, collections of statistics under the new “insurance fraud” category which has been added to the PULSE system; as well as the launch recently of Operation Coatee, a co-ordinated operation to tackle insurance fraud; and,
- the Courts Service has confirmed that it will publish a more detailed breakdown of awards in personal injury cases in its Annual Reports.
I believe that these reforms are having a significant impact with regard to private motor insurance (CSO figures from April 2019 show that the price of motor insurance is now 24.4% lower than the July 2016 peak). The Government is determined to continue working to ensure that these positive pricing trends can be extended to other forms of insurance, including those relevant to businesses and voluntary groups.
Undoubtedly the single most essential challenge which must be overcome if there is to be a sustainable reduction in insurance costs is to bring the levels of personal injury damages awarded in this country more in line with those awarded in other jurisdictions. In this regard, the Personal Injuries Commission has highlighted the significant differential between award levels in this country and other jurisdictions, and has made a number of recommendations to address this issue, in particular the establishment of a Judicial Council to compile guidelines for appropriate general damages for various types of personal injury. Both I and Minister of State D’Arcy believe that this awards gap needs to be significantly closed and we are working with the Minister for Justice and Equality, Mr Charlie Flanagan TD, to ensure that this happens at the earliest opportunity.
Finally, I would like to assure the Deputy that the Cost of Insurance Working Group will continue to focus on implementing the recommendations of the Report on the Cost of Employer and Public Liability Insurance in parallel with implementing those from the Report on the Cost of Motor Insurance. I am hopeful that the cumulative effects of the completion of the two Reports’ recommendations will include increased stability in the pricing of insurance for businesses and voluntary groups and a more competitive insurance market.