Dáil Éireann díospóireacht -
Tuesday, 3 Oct 2000

Vol. 523 No. 1

Written Answers. - Public Liability Costs.

Michael Ring

Ceist:

177 Mr. Ring asked the Tánaiste and Minister for Enterprise, Trade and Employment the steps she will take to deal with the escalating public liability costs in view of the fact that the quantity of claims and level of awards are three times the European average which results in higher premiums and leads to higher prices for customers; and if she will make a statement on the matter. [19355/00]

Minister of State at the Department of Enterprise, Trade and Employment (Mr. Treacy):

EU generated legislation, in force in Ireland since 1994, has had the effect of opening up EU markets, including the Irish market, to competition from insurance providers based throughout the EU. In addition, I believe the removal of the "cap" on brokers' commission will encourage further competition in the Irish market. Nevertheless, the level of insurance premiums in the area of public liability are still high enough to give concern.

There has been extensive examination of the factors contributing to the relatively high level of premiums focusing on a number of the key cost elements, including the levels of personal injury compensation and the costs associated with settling compensation claims. Concurrent with this examination, efforts are being made to identify measures which both individually and cumulatively could have a moderating effect on insurance costs.

The 1996 Deloitte & Touche report on the economic evaluation of insurance costs found that the main contributory factors to rising premium costs were the high legal costs component of small claim settlements; the faster rate of medical cost inflation and the high level of general damages awards relative to special damages in smaller claims.

Following consideration by Government of the Deloitte & Touche report, a special working group was established to advise on the establishment of a personal injuries tribunal and to examine issues surrounding alternative systems of personal injury compensation in operation in other jurisdictions.

I am currently in the process of examining the recommendations contained in the special working group's second and final report on a personal injuries tribunal.

Apart from Government initiatives, greater attention to safety in the workplace can further reduce insurance costs. Accordingly, I launched the voluntary code of practice adopted by the initiative on workplace safety group, a group representing the key players in the area of accident prevention and claims mitigation.