Tuesday, 8 October 2019

Questions (48)

Pat Casey


48. Deputy Pat Casey asked the Minister for Finance the rank of Ireland in the EU in terms of the level of motor insurance and business insurance costs; and if he will make a statement on the matter. [40914/19]

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Written answers (Question to Finance)

At the outset, it is important to note that as Minister for Finance, I am responsible for the development of the legal framework governing financial regulation and my Department does not collect the type of information being sought by the Deputy. Indeed, there is no official centralised source of such data within the European Union that provides for rankings in relation to insurance costs between countries. Therefore, I am unable to provide the Deputy with Ireland’s ranking on the two issues raised.

The Deputy should note that it would be very difficult to collect and compare such information as the level of motor and business insurance costs will be determined by a range of different factors. For example, in drawing any comparison between average insurance premiums across EU member states, it should be borne in mind that variation in premiums will reflect factors such as the economic and regulatory environment in each country, the legal system, health and safety standards etc. An example of one of these differences is that settlement awards for minor and moderate injuries are significantly higher in Ireland than in the UK, as was determined by the Personal Injuries Commission.

This is why the work of the Cost of Insurance Working Group (CIWG) is so important. The CIWG, which was established in July 2016, and which produced two reports, is continuing to work to implement the recommendations of the Cost of Motor Insurance Report and the Cost of Employer and Public Liability Insurance Report. Its most recent Progress Update, the Ninth, was published in July 2019 and shows that the vast majority of recommendations and actions due by Q2 2019 have been completed. Going forward, there are some further measures that will be carried out by Government over the next few months. These include the following:

- Commencement of the remaining parts of the Judicial Council Act 2019 , which provides for the establishment of a Personal Injuries Guidelines Committee. It is now matter for the Judiciary to put in place the Judicial Council and to operationalise the Personal Injuries Guidelines Committee, which will introduce new guidelines to replace the Book of Quantum; this is an essential step if award levels are to be reduced.

- The completion of the Central Bank’s feasibility study into adding Employer and Public Liability insurance to the National Claims Information Database (NCID). In addition, the first report of the NCID, on motor insurance, is due by the end of the year;

- The completion of the CSO’s feasibility study into tracking the cost of business insurance, as it does with other forms of insurance including motor. The CSO is due to report back to my Department by the end of the year;

- The Law Reform Commission’s 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. It is expected that there will be a public consultation on this by the end of the year; and,

- The furtherance of measures necessary to implement Pre-Action Protocols (PAPs) for personal injury cases, beginning with medical negligence cases.

In addition, my colleague, Minister of State D’Arcy, has been engaging with insurers in order to seek a commitment that they will reduce premiums and widen their risk appetite should there be a recalibration of award levels downwards once the new personal injury guidelines are introduced.

I believe that these reforms are having a significant impact with regard to private motor insurance (CSO figures from August 2019 show that the price of motor insurance is now 24% lower than the July 2016 peak). The Government is determined to keep working to ensure that these positive pricing trends continue and can be extended to other forms of insurance.