Dáil Éireann díospóireacht -
Tuesday, 15 May 2001

Vol. 536 No. 2

Written Answers - Public Liability and Motor Insurance.

Seamus Kirk

Ceist:

141 Mr. Kirk asked the Tánaiste and Minister for Enterprise, Trade and Employment the measures she is setting in train to help control the cost of public liability and motor insurance; and if she will make a statement on the matter. [13560/01]

Tánaiste and Minister for Enterprise, Trade and Employment (Ms Harney)

Insurance price movements are normally based on underwriting experience as well as trends in the level, frequency and cost, past and potential, of claims and are a matter for judgment by individual private insurance companies. Decisions on the risks that the companies are prepared to underwrite are also a matter for the companies themselves.

Under EU law, our Department is prohibited from having any function in relation to either prior approval or prior notification of price changes nor can our Department intervene in particular underwriting decisions by insurance companies.

The primary focus of initiatives aimed at reducing insurance premiums must be on reducing the frequency of accidents and the associated costs of settling the consequent claims.

There has been extensive examination of the factors contributing to the relatively high level of insurance premiums in the area of public liability. A Deloitte & Touche report on insurance costs in this country found that the main contributory factors to rising premium costs were, again, 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.

The Motor Insurance Advisory Board will be reporting to me later this year, after which I will take whatever further action is appropriate towards the goal of reducing the cost of motor insurance. Furthermore, the establishment of a personal injuries assessment board by 2002 will address the issue of the high delivery cost of compensation.