Written Answers. - Insurance Industry.
Joe Costello
Ceist:
113
Mr. Costello
asked the
Tánaiste and Minister for Enterprise, Trade and Employment
the progress made to date with regard to the implementation of her action plan for the insurance industry; if less than half of the recommendations have been implemented to date; the timetable for the implementation of the different elements of the plan; if she intends to take steps, in the meantime, to deal with the escalating cost of insurance; and if she will make a statement on the matter.
[29907/03]
Denis Naughten
Ceist:
119
Mr. Naughten
asked the
Tánaiste and Minister for Enterprise, Trade and Employment
the action she is taking to address the spiralling cost of insurance; and if she will make a statement on the matter.
[29644/03]
Eamon Gilmore
Ceist:
120
Mr. Gilmore
asked the
Tánaiste and Minister for Enterprise, Trade and Employment
if her attention has been drawn to the recent warning from the chairman of ISME that insurance costs could rise by as much as 25% in 2004; if figures are available to her Department regarding the likely level of insurance costs in 2004; the steps she is taking to deal with this problem; and if she will make a statement on the matter.
[29909/03]
I propose to take Questions Nos. 113, 119 and 120 together.
I am very much aware of the high cost of insurance in the State and the difficulties it is causing for businesses and members of the public in general. The insurance reform programme that I announced on 25 October 2002 comprises a comprehensive set of inter-related measures designed to improve the functioning of the Irish insurance market. The key measures include implementation of the recommendations in the Motor Insurance Advisory Board action plan within a target timeframe. To date, 32 of the recommendations have been fully implemented, three have been partially implemented and work is in progress on the implementation of the other recommendations.
Another measures is the establishment of the Personal Injuries Assessment Board. The Personal Injuries Assessment Board Bill 2003 was published on 18 November 2003 and is currently before the Houses of the Oireachtas. It is hoped to enact the legislation by the end of the year. This Bill will, when enacted, provide for the establishment of the Personal Injuries Assessment Board on a statutory footing.
Another measure is the undertaking by my Department and the Competition Authority of a joint study into the insurance market. The study will identify and analyse barriers to entry and limitations on rivalry in the insurance marketplace. It is envisaged that the bulk of the work will be completed this year and that a report will be produced in the early part of 2004.
I chair a ministerial committee established to drive the coordinated implementation of the reform programme across the relevant Departments and other bodies concerned. Substantial progress is being made on a range of measures that will radically overhaul the functioning of the insurance market and help tackle the high cost of insurance. These include measures to reduce the number of accidents, to tackle fraudulent and exaggerated claims and streamline the law in relation to personal injury claims.
While EU law prohibits the imposition of price control on insurance 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 and businesses.
I am aware of the recent predictions being made by the chairman of ISME in relation to the possibility of increases in insurance costs. While I do not have specific information on insurance premium levels in 2004, indications from the Irish Insurance Federation is that the cost of insurance premia have peaked, and that reductions are expected in commercial insurance, given the current conditions and the expected implementation of further reforms such as the PIAB and the Civil Liability and Courts Bill. Reductions have already occurred in motor insurance and further reductions are expected. For the purposes of comparing trends in the cost of motor insurance, I am using the insurance sub-indices calculated from the all items consumer price index produced by the Central Statistics Office. The consumer price index of motort ransport insurance shows that between April and October of this year there was a reduction of 9.9 index points or 9.1%.
