Deputy Pádraig Flynn. He has 40 minutes.
Private Members' Business. - Motor Insurance: Motion.
Molaim an tairiscint in ainm Deputy V. Brady, I move the motion put down in the name of Deputy Vincent Brady:
That Dáil Éireann requests the Government to take whatever steps may be necessary to ensure that insurance cover for motor vehicles and motor cycles is made available to all members of the public under conditions and at premium rates which are fair and reasonable.
It is obvious from the Government amendment to this motion that they are supporting the motion as put down by the Fianna Fáil Party. While I am pleased that is the case, I feel that the Minister will be at some pains to justify the steps he refers to in his amendment in support of this amendment. While the Minister obviously takes on board the thrust of our proposal, I must criticise him immediagely for not having taken the appropriate steps to ensure that insurance is made available to motorists and motor cyclists at reasonable costs. I do not have to wait for the 1984 blue book, the summary of insurance company activities, to provide evidence to the House and to the country of the cash crisis that exists now in the general insurance sector of the insurance industry. We are all aware of the premium increases and the restrictive cover in all the areas of general insurance, public liability, employer's liability, motor insurance, household business and fire damage. Every one of those areas of insurance is a loss maker for the insurance industry. There is general agreement both in the House and outside concerning the major causes of high insurance costs. They are as follows: court and legislative procedure for claims processing, the rising crime wave, escalation in the number of uninsured drivers and poor safety precautions in industry, in public places and on our roads network.
I should like to deal specifically with the question of motor insurance costs and motor cyclists' insurance cost and if the Minister could confine himself to that area it would be of considerable benefit to the hard-pressed motorist rather than widening the debate as indicated in his amendment which refers to improving the insurance environment generally. I request the Minister not to do this in the debate and to give us details of the steps which the Government have taken over the last few years to ensure the provision of insurance at a reasonable cost. However, no steps have been taken and the Minister will be at some pains to prove his point——
The Deputy can make his contribution, I will make mine.
The long suffering motoring public are demanding cheaper motor insurance and fair play for all categories and classes of drivers. Action is needed from the Government in dealing with uninsured drivers and in simplifying the legal system. Action is also needed from the insurance companies in the method of premium pricing, bonus flexibility and the elimination of restrictive practices. Action is required from the motorist in higher standards of driving, road safety and car maintenance.
The cost of car insurance is not about to come down despite the fact that certain agencies and interests have been predicting this for some time. Insurance losses were about £25 million, that is the difference between premiums and claims in 1984. It is expected that that figure might well be in excess of £52 million in 1985, therefore, it is nonsense to suggest that no matter what changes are brought in by the Minister in the short term we will have reduced motor insurance costs. We are ranked as the most expensive country in Europe for motoring costs, including those of petrol, repairs, tax and insurance. The Irish insurance industry has had a pretty dismal decade in so far as these matters are concerned and many brokers have gone into liquidation over the past ten years. The Government have had to come to the rescue of two major motor insurers, the PMPA and ICI, with possible total losses escalating to anywhere between £400 million and, if we believe the recent "Today Tonight" programme, in excess of £600 million.
The Government have indicated their awareness often enough in so far as the crisis in general insurance, in particular motor insurance, is concerned, but we are all well aware of their reluctance to take effective action, which is unforgiveable as far as the motoring public are concerned. We are talking about somewhere in the region of 800,000 motorists who have indicated, not just to Members of the House, but by way of action through their insurers, that they are not satisfied that the Government have taken any worthwhile action to resolve their problem. We are a claims-conscious society and greater vigilance and investigation must be exercised against overstated and often fraudulent claims. There is a need for a more efficient claims settlement procedure which could help to reduce costs. I can give the Minister an instance which indicates how it pays to sue. In the recent past a burglar who was caught in the act coming out of a premises not far from this House caught his hand on the window glass which he had broken to get in. Although he was caught in the act he has now sued the company and has stated that the place was unsafe. He is claiming under their public liability insurance that he should be compensated. That is an indication of how things have developed here over the years.
The statistics and analyses from all the reports over the years show that dangerous driving, failure to use safety belts and driving with drink taken have contributed greatly to the numbers and costs of claims. It means, in effect, that in some way motorists are also responsible for high insurance costs. The motor insurance sector is a major problem for the non-life market and is described loosely as the insurance industry's biggest headache. In Dublin, about half the motor claims lodged are crime related and those excluded uninsured cases. That gives some idea of the problems which have to be faced.
Perhaps the greatest single thing to which people refer when they talk about motor insurance costs is the number of uninsured motorists. Motor insurance continues to have huge underwriting losses. Let us consider the menace of uninsured drivers. We have an appalling record in relation to remedying the situation; 20 per cent of motorists are uninsured. The average in Europe is about 4 per cent and two European countries have statistics of less than 1 per cent. How can we justify the fact that 180,000 uninsured motorists are using our roads? This is a disgraceful statistic and the Minister must show how he proposes to deal with it. It puts law abiding citizens at a huge disadvantage as they are paying their own insurance costs and those of their neighbours. They pay the claims of the victims of accidents involving uninsured people. The Motorists' Insurance Bureau, which was set up in 1955, provides a scheme of compensation for victims of uninsured motorists in respect of injuries to the person. It simply means that in respect of the Road Traffic Act, 1961, which says that having no motor insurance cover is a statutory offence, the victims of those with no insurance should not be deprived of compensation. Who has to pay the compensation? The insurers contribute to it but everybody realises that if the insurance companies are contributing to the Motorists' Insurance Bureau it means that the policy holders and those who pay their insurance premiums are paying towards the upkeep of that bureau.
It is estimated that £70 of every motor insurance policy is as a direct result of insurers having to fund the MIB. It is also estimated that the outstanding claims liability, direct and indirect, with the Motor Insurance Bureau at this time is in excess of £80 million. That is a staggering total for uninsured drivers, those defectively insured and for hit-and-run cases. That accumulation of debt as far as uninsured motorists are concerned has to be met and paid for by those of us who pay our insurance premiums. It is about time the Government decided to do something to change that disgraceful statistic which puts us at the head of the European league as far as such drivers are concerned.
Fianna Fáil are not just concerned with the question of uninsured motorists but to stop uninsured driving by making it financially practical for all motorists to obtain reasonably priced insurance cover. That is the thrust of the motion before the House. We are trying to impress upon the Minister the importance of supporting us in our efforts to reduce the number of uninsured motorists using our roads. We are satisfied that if that occurred there would be a substantial saving on motor insurance costs.
The Government and insurance companies will have to adopt new measures. Motorists will have to participate in these measures. Fianna Fáil are proposing measures that may assist the Minister in this regard. We believe that our motoring laws are adequate at this time but their enforcement is lacking. Fines for deliberate offences, particularly in the area of no insurance, should be more severe and there should be wider use made of the suspension of the licence of drivers found guilty. Many of these recommendations were contained in the report of the inquiry into the cost of methods of providing motor insurance issued in 1982 but, as yet, virtually nothing has been done to accommodate those recommendations.
It is important that consideration is given to channelling all fines for motoring offences back into the Motor Insurance Bureau so as to reduce premiums. If the fine on every person convicted for an offence of driving without insurance in the past 12 months was averaged out at £300 per person and that money was given to the bureau it would have meant in the region of £12 million in the coffers of the bureau. If that amount of money was used to reduce motor insurance costs it would not just reduce premiums but would decrease the final reserve requirements of the Motor Insurance Bureau in so far as the other insurers are concerned. There is no doubt it would have resulted in a substantial saving as far as motoring costs are concerned.
Fianna Fáil believe that there should be more on-the-spot fines for failure to produce insurance certificates because we are satisfied that too many escape the net even when confronted by gardaí. Substantial sums of money could be collected in that area. Such a procedure would reduce the number of uninsured motorists on our roads. We believe that there should be compulsory testing of vehicles over five years of age and such a scheme of compulsory testing would be self-financing. Certainly, many of the vehicles on our roads, whether it is because of the recession, loss of disposable income or other Government measures, leave a lot ot be desired. The Minister should immediately set about establishing vehicle testing stations. Well-known garages should be appointed to carry out that service. There is no doubt that such testing would help to reduce the number of dangerous "jalopies" being driven on our roads.
I should like to deal with the question of fines and the statistics in relation to them. I have drawn evidence on this from surveys undertaken by the Irish Insurance Federation who have been carrying out surveys on fines imposed on uninsured drivers in recent years. That body recently published their second such survey which shows that more than 60 per cent of the fines imposed were less than £100 and more than 25 per cent were under £50. Those fines have been handed down by the courts despite the fact that a former Minister introduced a measure increasing the maximum fine to £1,000 for driving without insurance cover. The number of fines in excess of £100 has more than doubled from 1984 to 1985, from 19 per cent in October 1984 to 39 per cent in March 1985. We regard that as totally unsatisfactory.
The majority of cases brought before the courts for driving without insurance cover were dealt with by the judges who did not impose fines at the level envisaged by the Oireachtas which increased the maximum from £100 to £1,000 in June 1984. While the Irish Insurance Federation are recommending very strong medicine in this regard we would hope that the courts will bear in mind that imposing a fine of £50 or £100 on a person driving without insurance cover who would be asked to pay between £800 and £1,000 for that cover will not do anything to reduce the number using our roads without insurance.
The suggestion that the Government should introduce an insurance disc from 1 July this year and that people should be obliged to display that disc on their vehicles from that date was adopted and it will be an offence to fail to display that disc from that date. I would have thought that by this time all motorists would have been issued with these discs by the insurance companies but my information is that discs have not been forwarded to all motorists. If that is the case, then the Minister and his agents, have not taken the necessary steps to guarantee that that measure, which was proposed by Fianna Fáil some years ago, will be implemented. It is our belief that that measure will go some way towards reducing the number of people driving without insurance cover. At least for the first time in the history of the State one will be able to walk through a car park or along our streets and identify the culprits who are driving without insurance cover and are costing the average motorist a lot of money in the form of huge premiums to meet claims arising out of accidents in which those people are involved.
Fianna Fáil feel that the Government should carry out an emergency programme of low cost improvements at accident black spots which are readily visible to everybody travelling up and down the country. We are all aware of the accidents which occur at such places. We cannot understand why the Government, as an emergency measure, do not improve the road surface at those accident black spots. I have no doubt that such work would result in a reduction in the number of insurance claims which, in turn, would mean a big saving on insurance generally. We recommend that there should be better security and locking systems on all cars. Better locking devices should be fitted as standard at the point of manufacture. Those who have a better locking mechanism installed on their cars should be given relief on their insurance policy. I hope the Minister will consider making it mandatory on motor manufacturers to have such devices fitted as standard at the point of manufacture.
The jury system change was not recommended in the 1982 report. That is outlined fairly clearly in chapter 7 of the Report of Inquiry into the Cost of Methods of Providing Motor Insurance in 1982 in so far as that report stated there was inconsistency and unpredictability in awards. Therefore, it has not been recommended that that be altered. Certainly something will have to be done. The Minister has legislation before the House. For some unknown reason he had great enthusiasm when the matter was introduced some time ago, when he was giving everybody to believe that it was a matter of urgency and priority with the Government. But for some strange reason, or perhaps for some lobbying reason by some sectional interest, it has been relegated to the second list of priority. While the Taoiseach indicated to me last week that it was proposed to introduce it this session, there is still no clear indication from the Whips that they propose to do so this year. I will have more to say about that later.
Whatever the result of the Government measure with regard to juries dealing with personal accident claims, it will not reduce car insurance premiums. It is as well to get that matter clear here this evening because many people believed that if we did away with the jury system somehow, overnight, car insurance premiums would be reduced. That will not be the case and that has now been accepted by the insurance companies.
We think there is a need to deal with legal fees. Legal fees and expenses contribute to the overall cost of motor insurance claims and, where cases go to court, we contend that fewer lawyers should be required. Provision should be made for the presentation of agreed medical and other professional evidence without the need for expensive personal attendance of professional witnesses. We believe the Minister could do something in that respect. In addition, we believe that court procedures could be simplified and periodically we would like to see him revise lodgments and jurisdictions. That does not take place often enough. An ideal opportunity is afforded to the Minister to do that, which would be helpful also.
We believe there should be an amendment of the Administration of Justice Act 1914 which provides that, irrespective of what is the maximum fine by the Legislature—and we know £1,000 is the current limit in so far as uninsured motorists are concerned—the judge has to take into consideration the ability of the individual to pay. Consequently most justices are saying: "He is not able to pay the £1,000 and it would be inequitable to ask him to do so." It should be remembered that 80 per cent of the fines are under a couple of hundred pounds. Until that Act is amended the problem will not be tackled because people will just contend that it is cheaper to pay the fine than to pay the insurance.
We believe also that considerable progress could be made to remove uninsured motorists from our roads which would result in very large savings in insurance motor costs, for example, if there was a link-up between registration, taxation and insurance. All of these elements are now computerised but there seems to be some reluctance to tackle collectively the whole problem of uninsured motorists. It should be remembered that our personal injury awards are the highest in Europe, inflicting crippling losses of up to £100 million in the general insurance area. These, together with high legal fees, contribute to equally high levels of insurance dodging and to high premiums for those who pay.
As far as we are concerned, barristers are generating restrictive practices in their profession and in court appearances in personal injury claims. It is agreed universally that four legal representatives pleading a case is an unnecessary legal involvement. It must be understood that legal costs contribute up to 20 per cent of the liability claims payments. These are the stark facts that must be faced. Many of the practices are decried by the barristers themselves and they can and should be significantly reduced. If they were it would have a very large bearing on reducing motor insurance costs.
We should like to see speedier trials, fewer delays in High Court actions and less legal representation. We are asking that the legal and administrative costs be substantially reduced thereby assisting in the stabilisation of insurance premiums. It is now generally understood that there is an application at present in the Department for a sizeable increase in motor insurance costs. It has been suggested to me that it might be up to 15 per cent. I shall be very pleased to hear the Minister say that that is not so. However, in the market place it is being suggested that one company has lodged an application for an increase of that magnitude.
We are all aware from experience that, if a company requires such an increase to remain solvent, the Minister will grant it and once granted, it will be applied across the board to all other insurance companies. We should like the Minister to say he will guarantee to the motoring public that there will be no such insurance cost increase, that anything of that nature will be kept below the inflation rate which I take to be, in accordance with what the Taoiseach said, nil in 1986. Therefore we can look forward to negative increases in insurance costs this year. Those are matters we should like the Government to take on board.
Additionally we believe that the motorists themselves have a responsibility because there is reckless driving on our roads. Many of our motorists are guilty of and can be charged with anti-social behaviour in the way they drive. Half a million prosecutions took place last year. They included offences of parking, tax defaults, no licences, a whole range of offences under the provisions of the Road Traffic Act, 1961. In the serious offences category there were 65,000 people before the courts for no insurance last year, some 13,000 for dangerous driving and approximately 9,000 for drunken driving. One might well ask: how many evaded the law? If one were to add the number who evaded prosecution or being caught at all, then one arrives at a staggering total, clearly illustrating the number of people who have a total disregard for law and order as far as motoring is concerned.
We understand that 46 per cent of the drivers killed on Irish roads last year had an unlawful blood alcohol level, which must be of considerable concern to everybody. The Minister must realise that something has to be done to alleviate this appalling situation which has resulted not merely in motoring accidents but hardship for so many innocent families. In tandem with that alleviation will come the reduction of motoring insurance costs. Dangerous driving and careless driving are causing great suffering and hardship to the community at large, to families, to business and to industry. Road accidents were estimated last year as costing our community in excess of £200 million. We think that money could be put to better use. We should like to think the Minister would take some initiative in bringing about an alleviation.
Then there is the question of safety belts and the number of people who do not bother their barney to concern themselves with that facet of the law: two out of three of the motorists on our roads break the law in that regard. Only when one sees photographs of the enormous bodily damage in even minor collisions, without the use of a safety belt, does one get some indication of why it is important to press home this matter and ensure that more people take note of the law. It can be spelled out quite simply like this: the force of an impact at just ten miles per hour is the equivalent of catching a 200 pound bag of cement thrown from a first storey window — that is without a safety belt. If some of these statistics were brought to the attention of the general public it might go a long way to bring about a recognition of the law on the part of the public generally. That law became compulsory for drivers in 1979 but there has been a success rate of only 35 per cent. In the UK, 94 per cent of motorists wear their safety belts and it has resulted in a reduction in the number of deaths and serious injuries in that jurisdiction. That is why their insurance costs are much lower than here.
The person who does not wear a belt in his car is six times more likely to die in a collision, according to a recent Foras Forbartha report. The consequence of car occupants not wearing safety belts for insurers generally works out at about £1 million per week in claims. Of course it is a considerable drain on State resources in the provision of ambulance and medical services and police patrols. Therefore, the Minister should take the initiative, get on to the road safety people and have a campaign. Even if it were expensive, one decent campaign would be much less expensive than the cost to the community and to a family of one serious accident, particularly when safety belts are not used.
There must be a thorough prolonged advertising and educational campaign by the National Road Safety Association, first to shock people and then to encourage them to belt up, thus reducing the numbers of deaths and serious injuries on our roads. Such a campaign would help to reduce the frustration and hardship consequent on serious accidents. It would also encourage a reduction in motor insurance costs.
A reduction in the number of claims for motor accidents is one sure way to reduce the cost of motor insurance. Insurers who get licences from the Minister should not be allowed to discriminate against young Irish drivers. Some insurers refuse to take certain types of drivers and certain age groups on their books; others charge enormous premiums and apply heavy loading for certain categories. Others operate group schemes for certain classes in society, operating in the cream of the business and leaving the high risk business to a few well known insurers. Legislation might be the last resort, but the Department should use pressure to ensure fair play in the industry. There is no justifiable reason why all insurers cannot be persuaded to take on their books young motorists in numbers proportionate to the total number of motorists on their books. That should be mandatory in the licences granted by the Minister. If that were so, we might get a better spread than leaving it all to one or two.
Young motorists have a real problem. Statistics show that more than half of those killed on our roads are younger than 30 years—the young are more likely to be involved in motor accidents than older persons. The persons most at risk are between the ages of 19 and 23 years. I suppose they use the roads more during the high accident periods at night. A 17-year-old can get a provisional licence to drive without having received basic instruction. We should make it more attractive to get a full driver's licence by offering generous premium discounts to those who have formal instruction.
Ireland is the only country where a person can drive without being licensed or qualified. The most inexperienced driver can take a car on Irish roads capable of top speeds of 150 m.p.h. and the only legal requirement is a provisional licence with front and rear "L" plates. That is totally unacceptable. As many as 16.5 per cent of car drivers involved in fatal and serious injury accidents in 1983-84 were between the ages of 20 and 24 years. This was the highest percentage of all groups of drivers and it was due to drivers being allowed on the roads without full licences.
We believe that learner drivers should not be allowed to take out cars over a certain capacity until they have qualified for a full licence. We believe it is morally wrong that young drivers should be fully loaded at the outset because of their inability to pay, causing major social and economic hardship and inequality. Therefore, we suggest a no-blame premium for young drivers so that they would be loaded in the event of claims rather than at the inception. If we had that we could offer young people reasonable insurance costs at the start. That would encourage them to be more careful because they would have the sure knowledge that if they were not insured they would be loaded with considerable excess costs after every accident.
I will finish by talking about motor cyclists. They have a particular problem. We disagreed with Deputy Kavanagh when he was Minister for the Environment on his attitude to motor cyclists. There are about 70,000 of them here. We believe there should be a new code disc for motor cyclists, clearly displayed on all cycles. There should be two discs, one carrying the cyclist's liability, excluding cover for pillion passengers, and one covering pillion passengers, in different colours. Those carrying pillion passengers should have full drivers' licences and there should be a no-claims bonus for that type of cover. There should be an increase in the ratings in regard to brake horse power. We suggest maximum liability for pillion passengers as a possibility. There should be greater police surveillance for all types of road offenders. We do not think it is an option to debar motor cyclists from carrying pillion passengers. If we did we would be taken before the European Court and we would lose our case.
There is a case to be answered on why motor insurance costs are so high here vis-á-vis the UK and the rest of Europe. The Government, the insurers and the motorists can achieve the results we want, the provision of reasonable insurance costs for all Irish motorists.
I move amendment No. 1:
To delete all the words after "Dáil Éireann" and substitute the following:
"takes note of the steps being taken by the Government to improve the insurance environment and to ensure that motor insurance is made available at a reasonable cost."
I listened in silence and with curiosity to the speech made by Deputy Flynn on this very important matter — with curiosity if we go back and look at the root causes of our present high insurance rates. I have not been able to find any legislative initiative by that wonderful Fianna Fáil Government who served the country from 1977 to 1981. During that period all our economic ills were initiated and exacerbated. In the years between 1979 and 1982 the net underwriting losses for the whole motor market rocketed by more than 500 per cent. There was a huge inflation rate, activated by the economic wizards on that side of the house.
I know who wrote the Minister's speech. I could name him for him.
Nobody wrote that for me. I am expressing my own mind on a matter of political importance. The Deputy and his party stand condemned for their inactivity in the period 1977 to 1981 as far as motor insurance is concerned.
It is the Coalition Government who are on trial now.
It took a Coalition Government to have the courage to establish the committee of inquiry into the cost and methods of providing motor insurance in 1981. Deputy Kelly was the Minister responsible. Since that report came to us, we have taken further action. That was outlined in a press release of October 1983, when a specific 20 point action programme was established. That solid action taken by this Government stands in stark contrast with the inaction and ineffectiveness of the Fianna Fáil Government during that period and in 1982.
We live in a very claim-conscious society and must recognise that. We have come through a highly inflationary period. That inflation is reflected in the rapid upward adjustment in motor premium rates. In response to this, we set up that inquiry and since then an inter-ministerial group have been established and have reported to Government on two occasions.
We heard nothing about that.
We have committed ourselves to a plan of action to make the environment for insurance more reasonable and more economical.
Words, words, words.
The indications now are that the underwriting losses under the motor insurance heading are continuing to reduce from a high in 1983, when there was an underwriting loss of £50 million. We are hopeful that that beneficial trend will continue. However, it will continue only because of the positive policies undertaken by this Government in a wide number of areas, some of which I am about to go into in some detail. The actions taken affect not only the Department of Industry and Commerce but also the Department of the Environment and of Justice. I should add that the Ministers of State from those three Departments formed the inter-ministerial group on motor insurance which I had the honour to chair. We first reported to Government in August 1985 and a second report is at present before Government.
I intend, for the benefit of the Deputies present and particularly the Opposition spokesman, briefly to outline the progress made in the various measures taken by Government which are intended to improve the motor insurance environment. The measures taken by the Government can be categorised in a number of ways. All these are designed to improve the insurance environment in general and ultimately to reduce the cost of motor insurance. The measures focus on improved road safety and on reduction of the number of accidents and hence the number of claims which arise and on the reduction in the cost of claims by, inter alia, abolishing jury trials in civil injury cases and clamping down on uninsured motoring generally.
In the Government's view the actions already taken, together with those measures which are currently to hand, will have a considerable beneficial effect on the level of premiums charged by insurance companies. Already the indicators are that premium rates have stabilised and there has been an indication of a possible continuation of that stabilisation and, it is hoped, reduction. There has been a reduction in the number of claims and also an indication that the heavy underwriting losses which were incurred are declining.
I shall now outline in more detail some of the principal measures to which I have just been referring. First, I should like to mention the measures which are designed to reduce, where possible, the number of claims. A vital ingredient in reducing the cause of claims — and thereby the number — is the active promotion of road safety. In this respect the Department of the Environment are undertaking an active campaign to eliminate all accident black spots and to pay special attention to those aspects of road maintenance which contribute most to improved road safety. Deputy Flynn was aware of this when making his contribution.
Did the Government not cut the capital expenditure programme on roads?
I have never, since I became a Member of this House in 1969, seen more road improvement programmes being carried out than I have been in the last few years.
I cannot believe that.
The Deputy must be travelling by plane.
I shall have to travel by plane because I am afraid of my life to go down the roads on account of the potholes. Knock Airport will be opening shortly, anyway.
Priority continues to be given to the national and other heavy traffic routes. The National Road Safety Association's publicity programme for 1986 will highlight the aspects of themes selected by the EC Transport Council as appropriate to the year. These will include drunken driving, the wearing of seat belts, speed, child safety and the safety of two-wheeled vehicles. The programme will include the publication of a road safety textbook for primary schools. Its major feature, however, is a scheme devised by the NRSA in partnership with local authorities designed to secure the active involvement of local communities in road safety projects during the year. The Garda will commence a special vehicle defects campaign in May of 1986. Obvious vehicle defects will be pointed out to the motorist who will be asked to correct them within a time specified by the Garda. If these defects are not corrected within that time, prosecution will follow. In addition, I understand that the European Commission intends to make an announcement this year with regard to the community-wide harmonisation of car testing schemes. That will, of course, receive my full support.
Under the regulations made by the Minister for the Environment in August 1985 revised rules for learner drivers were introduced. These regulations apply to persons who are granted a provisional licence for the first time for car or light commercial vehicle. The new rules stipulate that such persons must be accompanied during the period of the validity of the first provisional licence by a person who holds a full driving licence for those classes of vehicles. There are additional provisions for the accompaniment of learner drivers at subsequent stages. L plates must be displayed at all times on vehicles being driven by all learner drivers.
I am happy to note that the trend in motor accident statistics is improving. In February of this year the Minister for the Environment announced that the number of road deaths had dropped from 628 in 1974 to 465 in 1984 and to 416 in 1985. The 1985 figure represents a reduction of 34 per cent on the 1978 figure. Total annual road deaths are now lower than at any time since the present system of accident reporting was introduced in 1968, when there were only 500,000 licensed vehicles compared with the present day figure of over 900,000. I would attribute the significant improvement to the ongoing programme of road improvement, road safety and the other measures that I have outlined.
Improved Garda traffic law enforcement has also made major contribution. Prosecutions in 1984 numbered 798,000 compared with a figure in 1983 of 684,000. I should like to record my satisfaction at the improvement in the numbers wearing seat belts. A survey carried out by An Foras Forbartha following the conclusion of the major NRSA seat belt campaign last autumn showed that over 60 per cent of drivers and front seat passengers are now wearing their seat belts. These figures are very low by international standards but the improvement over the previous wearing rates in Ireland has to be welcomed. I fully agree with what Deputy Flynn said in this regard. We should be far more careful to wear our seat belts because the damage which ensues from not wearing them is horrendous.
The motoring public have their own very positive contribution to make in complementing the efforts undertaken by the Government in improving our national road safety record. In this context I would again state the obvious, that we should all be aware that the surest, ultimate way of reducing motor insurance premiums and making insurance available at prices affordable by all our citizens, is to reduce the number of accident rates against the number of claims.
In addition to reducing the overall number of claims, another very pertinent factor in the reduction of motor insurance premiums, is reducing the average cost of claims. Earlier this year the Minister for Justice introduced the Courts Bill, 1986 which will give legislative effect to the abolition of juries in High Court actions for personal injuries. I am quite satisfied that the jury system in Ireland resulted in awards which were significantly higher than in other European countries. Indeed, studies undertaken in my Department indicated that awards are three to four times higher in Ireland than in the United Kingdom in serious injury cases. This situation combined with the unpredictability of awards not only poses serious provisioning problems for insurance companies but ultimately of course results in higher premiums to the consumer. Notwithstanding the fact that a minority of cases are settled in the High Court, it is held, quite validly I believe, that the levels of out of court settlements are affected or influenced by the High Court, it is held, quite validly I believe, so to speak "in the shadow of the court".
A number of other measures have been considered in detail in the second report to Government of the inter-ministerial working group on motor insurance. As this report is at present on the Government agenda I am not a liberty to disclose its contents fully at this stage. However, I can inform the House that the measures considered include the examination of the high level of legal fees pertaining to insurance claims and the necessity for the establishment of a quantum of damages in relation to awards made.
There has been widespread recognition that uninsured driving has contributed in no small way to the increasing cost of motor insurance premiums. In the past few years there has been a growing disregard by a minority of motorists for compliance with this aspect of the law. I condemn out of hand this very anti-social attitude.
It has been estimated by the Irish Insurance Federation that the impact on the premiums of insured drivers is £70 per premium on average. It is difficult to gauge the full extent of the problem. However, the most reliable statistic available to us is the number of prosecutions by the Garda. In 1984 these prosecutions numbered 108,000. In the same year the number of claims reported to the Motor Insurance Bureau of Ireland was more than 1,500. These claims by the victims of uninsured drivers resulted in claims paid by the bureau amounting to £8.9 million in 1984.
I am aware that suggestions have been made that the level of uninsured driving is in the region of 20 per cent but from figures available in my Department I do not think the level is that high and that perhaps it is between 10 and 15 per cent. The enactment of the Road Traffic (Amendment) Act, 1984 provided for higher penalities for offences under the road traffic code. The passing of that legislation seems to have escaped Deputy Flynn's attention.
One half of 1 per cent were fined more than £700.
I am glad to note from the information available to me that the courts appear to be making use of the new levels of fines they are permitted to impose. A survey undertaken in the Dublin Metropolitan Area revealed that in the second half of 1984 there was a distinct upward trend in the levels of fines imposed.
Under regulations made by the Minister for the Environment, provision has been made for the introduction of a requirement to display a windscreen disc for insurance as from 1 July 1986. The discs are now being provided by all insurers. Deputy Flynn may not be aware of that. It will not be compulsory to display these discs until 1 July next. The long period of introduction was to allow for the rolling on effect of renewals. People whose insurance falls to be renewed are being provided with these discs by the insurers.
Has the Minister seen any of these discs and, if so, can he tell us what colour they are? Obviously, he has not seen one of them.
I am sure that the PMPA one is green.
That company have been issuing insurance discs for the past five years. I am talking about the Government disc. What colour is it?
The scheme will be in order by 1 July 1986.
The colour is specified in the order.
The Minister for the Environment made the order.
It is obvious that the Minister has not seen one of these discs.
The Deputy should not be unduly concerned about this aspect. I might remind him that he did nothing in this regard during his period as Minister.
I was the person who proposed the use of these discs.
The Deputy has made more proposals tonight than might be made at a county council meeting in Ballymagash but he did nothing while in Government.
I wish the Minister would talk to the insurers.
It will be no thanks to the Deputy that the insurance discs will be compulsory by 1 July next.
Why is the Minister so rattled?
I am annoyed to think that while the people opposite were in Government between 1977 and 1981 there was total inactivity in the Department of Industry and Commerce in relation to motor insurance. The motorist suffered as a consequence.
I did more in the six weeks I was there than the Minister has done in the past four years.
The Deputy has not much to contribute to this debate either.
What has the Minister done? It is a matter of all jaw and no action.
The motoring public suffered as a result of the Fianna Fáil Government's inability to make decisions between 1977 and 1981.
Garda surveillance in respect of motor tax and insurance offences has been increased in recent years. The number of insurance offences in which proceedings were taken has increased from 48,000 in 1981 to 108,000 in 1984. The inter-ministerial working group have recommended that the increased monitoring by the Garda should be maintained and where possible intensified. Furthermore, they recommended that the results achieved by the Garda in the area of uninsured driving in particular should be publicised separately from the general crime statistics.
Some concern has been expressed in recent years about backlogs arising in both Circuit Court and High Court cases. In response to this, the Minister for Justice has investigated the situation and appropriate action has been taken. Delays in Circuit Court cases are not significant except in the Cork area. In response to this the Government have appointed an additional Circuit Court judge and it is understood that this judge has been assigned to Cork. In addition extra sittings of the court have been arranged in Cork to cope with the backlog.
In respect to High Court actions, the average time taken to dispose of cases is about 12 months but again, with the exception of Cork. The President of the High Court has arranged extra sittings in Cork to reduce the arrears and a significant improvement is expected in 1986. The recent appointment by the Government of an additional High Court judge will also allow for more flexibility in arranging additional sittings both in Cork and elsewhere.
Turning now to the question of motor cycle insurance, it is important to set out the facts in relation to this area of insurance. The motorcycle accident statistics for this country make frightening reading. Sixty-one motorcycle riders and eight pillion passengers were killed in 1983. Eight hundred and seventy-nine motorcycle riders and 173 pillion passengers were injured in road accidents in 1983. That is a total of more than 1,100 people killed or injured and the really frightening aspect of this figure is that more than 900 of those were aged between 15 and 30. That means that one in every 25 people who travel by motorbike will be injured or killed. The comparable figure for car travel is one in 200 people. It is patently obvious, therefore, that motorcycles are infinitely more dangerous than cars and the cost of insurance for motorcycles reflects this.
Norwich Union insure more than 90 per cent of all motorcycle risks in the country. In 1984, despite receiving approval for an increase of 17 per cent in their premiums, the company incurred an underwriting loss of £697,000 on its motorcycle account. This represents a loss of 16.8 per cent of its earned premium income. In 1985 that company held its increase in premium down to 10 per cent even though it anticipated a loss of over £1 million in that year which represented some 28 per cent of its earned income. The company has not increased its premiums since May 1985. Third party cover is, therefore still available at £67 for motorcyclists of 25 years and over for bikes up to 100cc in Dublin and £51 in the country. Because of the accident figures I quoted earlier, insurance cover for younger motorcyclists is more expensive.
£600.
I am aware of the difficulties being faced by those who need motorcycle insurance, especially young people who find that the premium is beyond their means. But my main concern as the insurance supervisory authority must be to ensure that companies remain solvent and meet their solvency and reserving requirements. Companies cannot meet claims costs, which in the case of motorcycle insurance are astronomical, if they charge uneconomic premiums and they are not in business to provide a social service. It is a legal requirement and they are there to ensure that they make a profit on it. They are not there to have substantial underwriting losses.
As I have said the biggest barrier to keeping motor insurance premiums stable or even to reducing them is the cost of claims. A great many of those claims are caused by carelessness and a complete disregard for the rules of the road. Basic knowledge of road safety could reduce the numbers of accidents significantly and thereby improve the insurance environment dramatically. If car drivers could be made more aware of other road users such as motorcycles and cyclists, if motorcyclists could recognise the need for less speed and more caution and if cyclists could understand that the rules of the road apply to them too, there would be fewer accidents, fewer claims and eventually lower insurance premiums.
Has the Minister received a claim for 15 per cent?
I will not interrupt the Deputy and I am finishing my speech. I feel sure that the above measures, which I have outlined briefly due to time constraints, must suffice to assure Deputies that the Government are taking every step possible to improve the insurance environment. It is the earnest desire of the Government that the continuing beneficial effects of the measures taken, together with the further impact of those yet to be introduced should ultimately be passed on to the insuring public in the form of actual reduction in premium rates.
In reply to the Deputy I should point out that it is intended to reduce the permitted blood alcohol level from 100 milligrammes to 80 milligrammes in the road traffic legislation under consideration. I have not received an application for a 15 per cent increase but I understand I may very well have one on the way.
I want to conclude quite sharply but quite simply that Fianna Fáil have a gall to put down this motion on motor insurance rates because when they were in power from 1977 to 1981 they did sweet Fanny Adams about the whole area.
That is unparliamentary.
In 1982 they repeated that inactivity. They were absolutely scandalously at fault in neglecting their responsibility to the motoring public by their inactivity. The Government have take this matter in hand. We established the PAC and acted on their report. The Government established the inter-ministerial group who have made substantial recommendations. The Government have taken substantial decisions which will reintroduce an environment in which savage underwriting losses incurred because of Fianna Fáil policies between 1977 and 1981, and premiums for our motoring public can be substantially reduced. We have done so on a broad number of fronts including action by the Department of Justice, the Department of the Environment and, where necessary, by my own Department. We will continue to be active in this area. Our action will stand in stark contrast to the inaction and uselessness of the Fianna Fáil regime between 1977 and 1981 and again for a short period in 1982. People are lucky Fianna Fáil are on the Opposition benches as far as motor insurance is concerned.
Methinks the Minister of State doth protest too much.
I recall raising the question of the difficulty for young people in getting insurance cover about 11 years ago when the Minister for Industry and Commerce, who was Justin Keating at the time, sanctioned a 40 per cent increase in motor insurance premiums for the PMPA. At that time young people were shocked at this massive increase. Of course, other companies, including foreign companies, joined in with their claim for 40 per cent. All those companies received their increases. We had the National Prices Commission at that time. This increase was sanctioned by the Government and it was a major blow for our young drivers. If you look at the situation in 1986, it is far worse. Drivers, particularly those under 25 years of age, are quoted massive premiums. Many of them cannot get a quotation as a result of which we have too many people driving on our roads without insurance.
This had led to many serious problems, one of which the Minister of State did not refer to and which I believe is the most serious. This is the fact that bogus motor certificates of insurance are being issued by what you might call plausible types of criminals who are taking advantage of these circumstance. This type of certificate is being produced by people at Garda checkpoints, by people who are playing along with the situation, or by gullible people who pay £300 to £400 to these con men who claim to be reputable brokers. They are using these bogus certificates which are worthless when investigated.
One of the areas which we should look at and discuss here tonight is the fact that there is a need in the motor insurance industry for a uniform type of certificate. It would be most advisable for the Minister of State and his Department to look at this because of the fact that young people cannot get certificates of motor insurance.
I do not wish to interrupt, but if the Deputy has concrete evidence of bogus certificates the matter should be referred to the Garda Síochána, or if the Deputy brings it to my attention, I will do so.
I will do that, but I would like to point out that this has been highlighted by detectives in the fraud squad. I ask the Minister of State to look at the evidence which has been submitted to the Department particularly by the detectives who are dealing with it. The Minister of State may have different figures but we are given to understand that some 20 per cent of the drivers on our roads have not got insurance. Where a person is injured by an uninsured driver the injured party can seek compensation from the Motor Insurers Bureau of Ireland. The various insurance companies are obliged to subscribe to the bureau.
All of us who hold policies contribute to the bureau in one way or another. In other words, we are paying for the fact that we have so many uninsured drivers on our roads. I should like the Minister of State to take up the suggestion made by Deputy Flynn concerning what he called a no blame insurance premium, particularly for our younger drivers.
The Minister of State highlighted the fact that only one insurance company are giving cover for motor cycles — the Norwich Union. The Minister of State will recall that last year we had a convoy of motor cyclists in the city of Dublin protesting at the expensive cover and protesting that cover could not be procured for pillion passengers. The Minister of State should look at this matter also.
Debate adjourned.