Niamh Smyth
Question:82. Deputy Niamh Smyth asked the Minister for Finance the way he plans to increase competition in the insurance sector; and if he will make a statement on the matter. [54355/21]
View answerTuesday, 9 November 2021
Questions (82, 123)
Ruairí Ó Murchú
Question:123. Deputy Ruairí Ó Murchú asked the Minister for Finance the engagements he has had with insurance underwriters to bring more into the market; if an update will be provided on the work of the Office to Promote Competition in the Insurance Market in this regard; and if he will make a statement on the matter. [54345/21]
View answerOral answers (6 contributions)
I want to ask the Minister of State his plans to increase competition in the insurance sector and if he will make a statement on the matter.
I propose to take Questions Nos. 82 and 123 together. As the Deputy may be aware, in July the Government published the first implementation report of the action plan for insurance reform, which shows that work is progressing well, with 34 of the 66 actions contained therein completed. The sub-group’s focus now is on implementing the outstanding actions on time.
One of the key achievements of the Government’s reform agenda is the new office to promote competition in the insurance market, which I chair. The office is an important element of the Government's ambitious insurance reform programme to help to enhance competition, reduce costs and increase the availability of insurance cover. Accordingly, the office has held meetings with a wide range of stakeholders, including insurance companies, representative bodies, civil society groups and State regulators on the issues surrounding competition. Its aim is to help expand the risk appetite of existing insurers and explore opportunities for new market entrants in order to increase the availability of insurance.
I met the CEOs of the major insurance providers in Ireland earlier this year and intend to meet them again in the next few weeks to discuss a variety of issues, including expanding their risk appetite. Separately, I am meeting various specialist firms that operate here and that are seeking to expand and provide cover in particular areas of the market. The office is also working closely with IDA Ireland to bring new entrants into the Irish insurance market and to improve its overall competitiveness. This will, in the first instance, seek out providers that offer insurance in areas which have been identified as pinch points in the Irish market where some customers are encountering difficulties in obtaining cover. This is exacerbated by Brexit in some cases.
The Government is committed to securing a more sustainable and competitive market through deepening and widening the supply of insurance in Ireland. It is my intention to work with my Government colleagues to complete this progress as part of the action plan for insurance.
The Deputy will only have the chance to come in once, along with Deputy Ó Murchú, as we have run out of time.
I know the Minister of State has taken a real and personal interest in this issue because he knows it has created huge barriers for people in business, the voluntary sector and the community sector. Sadly, the Alliance for Insurance Reform has done significant and extensive surveys of more than 450 businesses and voluntary and community groups and it has reported increases rather than decreases. The Minister of State talked about personal injuries and there are certain caps in that area. How can the Government act to improve competition and get additional underwriters into the market as a matter of urgency?
I ask the Minister of State to give a bit of detail on the specialist insurers he is talking about engaging with. I dealt with the Minister of State before on the matter of a particular business that is now facing the cliff edge. We are talking about a pile of firms and Deputy Doherty and others brought up the case of another firm in Dundalk earlier. We will be hitting that cliff edge in February, March or April. We need the duty of care legislation and then we need more providers to come into the sector to provide what is necessary. Otherwise we will have community centres, community groups and businesses closing. I know other specific answers will be required for the likes of the leisure industry. I ask the Minister of State to give some detail on that and I have no doubt that I will be talking to him about this afterwards as well.
I thank the Deputies for their comments and I want to give practical examples of what we are talking about. I met the Alliance for Insurance Reform last week and I hope to meet it again next month and the month after. It has indicated a number of pinch points where some groups are having difficulty getting insurance and that is a particular problem. The survey it referred to only included a number of businesses and is not reflective of all those businesses that have no problem getting insurance. The average price of insurance for a business, which includes sole traders, is about €2,000 per annum. That is a Central Bank figure; not mine. I will also meet Insurance Ireland and Brokers Ireland to discuss the areas in Irish society where there are particular difficulties obtaining insurance. Ice rinks were mentioned in this regard a week ago in a Topical Issue matter. Sometimes if four, five or six groups are operating in the country they might have to come together to help them help themselves in getting insurance collectively. That is the principle matter I will be pursuing in the coming weeks.
Written answers are published on the Oireachtas website.