Dáil Éireann Debate, Tuesday - 27 July 2021
296. Deputy Ruairí Ó Murchú asked the Minister for Finance the current and future plans to tackle the crisis in terms of public liability insurance; the expected timelines in this regard; and if he will make a statement on the matter. [40953/21]
View answerAs committed to in the 2020 Programme for Government, Government is prioritising reform of the insurance sector with particular emphasis on motor, public liability, and employer liability insurance. The whole-of-Government approach being taken through the Action Plan for Insurance Reform therefore sets out 66 actions which aim to improve both the cost and availability of this key financial service, particularly for businesses. As the Deputy may be aware, the Cabinet Committee Insurance Reform Sub-Group earlier this month published the first six-monthly Implementation Report of the Action Plan. This shows that work is progressing well to implement these important reforms, with 34 of the 66 actions now completed. The Sub-Group’s focus now is on implementing the outstanding actions on time.
One of the key achievements in the first half of this year under the Action Plan was the implementation of the Personal Injuries Guidelines , which represents a key achievement of this insurance reform agenda, and was realised several months ahead of schedule. The Guidelines significantly reduce award levels for many categories of common injuries, particularly those of soft tissue. Of note is that a number of common injuries will now move to the jurisdiction of the District rather than the Circuit Court, thus reducing associated legal fees. The Guidelines also provide guidance in relation to injuries previously not included in the Book of Quantum and will be used by both the Personal Injuries Assessment Board (PIAB) and the judiciary. Therefore, they should help to bring more certainty to claimants and insurers, and as such reinforce the benefits of using the PIAB to settle claims. This in turn should further reduce the costs of claims, particularly legal fees. I have previously set out my view that these costs, rather than the profit component, tend to represent a bigger factor in the cost of insurance premiums. As such, it is important that they are lowered.
As Minister for Finance, my expectation is that insurers will now commence reflecting savings from reduced award levels to customers, in line with past commitments, and I intend to hold them to account on this. Minister of State Fleming met with the CEOs of the main insurers operating in Ireland to set out the Government’s expectation in this regard. These engagements were positive, with insurers indicating that they will begin lowering premiums in response to the Guidelines. The Minister of State will meet with CEOs again later this year to review their ongoing response to this and other key reforms.
As the Deputy will also be aware, the Central Bank earlier this month published the first National Claims Information Database (NCID) report on employer liability, public liability and commercial property insurance. This is a rich source of data, which represents a baseline that will continue to be enhanced in the coming years, and enable us to analyse market developments. Ireland is virtually unique in having this level of information and transparency available to policy makers. Further development of the NCID is a key priority for my Department going forward, to allow Government to make informed and appropriate decisions when it comes to improving the public liability insurance market, as well as other forms of insurance for businesses. My officials are currently engaging with the Central Bank to consider what enhancements could be made, in particular so that the impact of the Personal Injury Guidelines can be seen in future motor, employer and public liability reports.
Finally, I would like to assure the Deputy that work remains ongoing across Government to deliver further elements of the Action Plan, including measures to reform the PIAB, reduce fraud, and make changes to the duty of care in order to strengthen waivers and notices. It is my hope that the implementation of these key actions in particular should further help to lower public liability insurance costs for businesses.
