It has been agreed to take first the question addressed to the Minister for Industry and Commerce in the name of Deputy Taylor. Deputy Taylor has five minutes to present his case and the Minister — or the Minister of State — has five minutes to reply.
Adjournment Debate. - Insurance for Young Drivers.
I should like to thank you, a Cheann Comhairle, for allowing me to raise this most important matter on the Adjournment. It concerns the very serious position in which many hundreds of would-be drivers are unable to obtain insurance to drive motor cars. In many cases they cannot get it at all and, in others, it is available to them only at extortionate and prohibitive premiums. One can imagine the sense of extreme frustration and anger among young people who are being forced to become criminals. We know that the numbers of young people driving without insurance is extremely high and is on the increase. Why? One of the reasons is that it is so difficult, if not impossible, for young drivers to get insurance to enable them to do the lawful thing, which so many of them want to do. I am sure that all Deputies have had representations made to them on how frustrating it is to approach insurance companies and try to get any kind of reasonable response.
One young man in particular consulted me within the last few days. He is aged 23 and holds a provisional licence; he approached five insurance companies to try to get insurance cover and I will relate the response in each case. The first insurance company told him to forget it, that they did not quote for anybody under 25 years of age. The second insurance company said precisely the same thing; the third company said that they would quote for somebody under 25 years of age provided that the person had a full licence. As I said, the person concerned has a provisional licence. The fourth company said the same as the first two; they do not quote for anybody under 25 years of age. The fifth company were prepared to give him insurance cover but the premium quoted was £1,783 for third party, fire and theft.
One can imagine a young person earning a modest income having to pay £14 per week on car insurance alone without taking petrol, depreciation and so on into account. It is a disgraceful situation. The insistence on a full licence is catch 22 because if you apply for a full licence you will not receive it unless you can show the Motor Registration Office that you have insurance. However, you cannot get insurance unless you have a full licence. Hundreds of our young people are in this position. It is not necessarily a matter of wanting cars for social activities, the employment prospects of many of them are affected by the lack of insurance. Many people, to get employment, or to advance themselves in employment, need car insurance at a reasonable rate.
Is the position the same in the UK or other EC countries? Not at all. In the United Kingdom young people can get insurance for £150 or £200 per annum. Why are we the fall guys? The same insurance companies are involved. Are we saying that our young people are a different calibre of driver from those in the UK? They are not, there is no difference. The reality is that the insurance companies are having us on. It is the Minister's responsibility to call them in and tell them that we want a fair deal for our would-be young drivers. If they want to trade in this country they should be brought into line and provide reasonably priced insurance to our young drivers.
I applogise for the absence of the Minister for Industry and Commerce who is attending a Cabinet meeting at present. I do not propose to go into the fundamental causes of high insurance as everybody knows the reasons. In the course of various contributions already in this House, details were given of a comprehensive list of measures to improve the environment for motor insurance, including the cost of insurance for young drivers, identified by the Inter-Ministerial Group on Motor Insurance, and subsequently endorsed by Government.
The measures, announced but not yet implemented, including the introduction of the necessary legislation by the Ministers for the Environment and Justice, are being given priority attention. Deputies will, of course, have an opportunity of debating the proposed text and objectives of the legislation in full in due course. Deputies will appreciate that questions about road traffic legislation and legislation in relation to the courts are properly addressed to the Minister for the Environment and the Minister for Justice.
The measures identified by the Inter-Ministerial Group on Motor Insurance have the objective of improving the environment for insurance, particularly motor insurance. The extent to which this objective is achieved will depend on the timing and the scope of their implementation and the impact which implemented measures will have on the frequency and cost of insurance claims. In this context, insurers and the general public, including motorists both young and old, have a role to play. Insurers are expected to control those factors within their ambit so that inefficiencies in the insurance sector do not give rise to any unnecessary costs which have to be borne by the community as a whole. The general public, particularly motorists, must play their part by increased awareness of the need for road safety. Indeed, I note that a recent report by the consumers' association stresses the responsibility that motorists themselves have, not just in relation to road safety, but also in relation to the cost of injury compensation.
Indeed, I would point out that unless and until the claims experience — including the claims frequency and levels of compensation paid to victims of road accidents — in Ireland matches that obtaining in other European countries there will be divergencies between motor insurance premia in Ireland and those applying in other countries.
This House should be fully aware that as the insurance supervisory authority the statutory responsibility of the Minister for Industry and Commerce, is to ensure that insurers maintain their solvency and reserve requirements. He is not responsible for the day-to-day operations of insurance companies, who must exercise their own commercial judgment in the conduct of their business.
I would like to take this opportunity to inform the Deputies, that under the declined cases agreement difficulties in obtaining motor insurance, including such for young and more mature drivers, are dealt with by the declined cases committee which are comprised of representatives of the authorised motor insurance companies. This committee, not the Department of Industry and Commerce, examine cases where refusals have been obtained from five or more insurance companies and nominate one of the companies to quote for the risk involved.
The refusals and details of previous insurance should be sent directly to the Irish Insurance Federation as it is the declined cases committee which nominate a company to quote and not the Department. I would add that the insurance industry have undertaken to ensure that insurance brokers are fully aware of the way in which the declined cases agreement operates so that any delays in obtaining quotations for motor insurance are minimised. I am a little saddened that Deputy Taylor did not put forward some solutions to what everybody accepts is a very serious problem and one that must be tackled urgently.
I will do that with the greatest of pleasure, but I cannot do so in five minutes.
I would welcome those proposals from the Deputy and I will pass them on to the Minister. As Minister with responsibility for youth affairs, this matter is of particular concern to me. There may be further initiatives that can be taken to tackle this problem in an effective way. I accept what the Deputy has said, that we all hear of such problems in the course of our constituency work and, inevitably, something must be done with regard to the difficulties experienced by young people in trying to get motor insurance.