Dáil Éireann díospóireacht -
Tuesday, 18 Feb 2003

Vol. 561 No. 4

Written Answers. - Insurance Industry.

Bernard J. Durkan

Ceist:

211 Mr. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the extent to which she has monitored insurance premium increases; if she has quantified the negative impact on competitiveness and job creation; her plans to address the situation; and if she will make a statement on the matter. [4766/03]

Bernard J. Durkan

Ceist:

212 Mr. Durkan asked the Tánaiste and Minister for Enterprise, Trade and Employment the reason 11 September has impacted much more severely on Irish insurance costs than in the UK or the US; and if she will make a statement on the matter. [4768/03]

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

I propose to take Questions Nos. 211 and 212 together.

The pricing and underwriting of insurance is a matter for individual insurance companies and EU law prevents me from intervening directly in the matter. Therefore, I do not have specific information on insurance premium increases. However, I am very much aware of the high cost of insurance in the State and I am concerned about the difficulties this is causing generally, including in the business area.

On 25 October last, I announced my programme for fundamental insurance reform. The programme reflects the commitments given in An Agreed Programme for Government and comprises a comprehensive set of inter-related measures designed to improve the functioning of the Irish insurance market. The key measures include: establishment of a ministerial committee, chaired by myself, to oversee implementation of the reform programme, including the 67 recommendations in the Motor Insurance Advisory Board report; publication of the action plan to give effect to the MIAB recommendations within a target timeframe; establishment of the Personal Injuries Assessment Board on an interim basis, pending preparation of the necessary legislation to put the PIAB on a statutory footing and; publication of the report of the implementation group on the PIAB.

I have made it clear that I consider there to be an onus on the insurance industry to ensure that the reforms to be taken will have the effect of significantly reducing the cost of premia to consumers.

I am committed to bringing about improvements in the functioning of the Irish insurance market. My Department, in conjunction with the Competition Authority, finalised terms of reference last December for a study being undertaken into the competitiveness of the Irish insurance market. The terms of reference are available at www.entemp.ie and www.tca.ie. The study will identify and analyse barriers to entry and limitations on rivalry in the insurance marketplace. While the 11 September attacks in the US are said to have impacted on the insurance market here, many other factors are also involved in putting upward pressure on premiums – reduction in investment returns, level of compensation awards and cost of settling claims, are examples. It is difficult to indicate the impact of any one factor on Irish premiums.