Dáil Éireann Debate, Tuesday - 9 May 2017
247. Deputy Barry Cowen asked the Minister for Housing, Planning, Community and Local Government his views on whether the use of latent defects insurance should be mandatory for all new residential constructions rather than voluntary, as it is at present; and his plans to introduce legislative changes to mandate its use by developers and assigned certifiers. [21940/17]
Amharc ar fhreagra248. Deputy Barry Cowen asked the Minister for Housing, Planning, Community and Local Government the level of use of latent defects insurance on new residential construction projects in each of the years 2014 to 2016 and to date in 2017. [21941/17]
Amharc ar fhreagraI propose to take Questions Nos. 247 and 248 together.
A number of companies operating in the Irish insurance market currently provide latent defects insurance cover in respect of new residential buildings. The Central Bank of Ireland is responsible for the prudential supervision of such undertakings authorised in Ireland. My Department has no function in relation to this aspect of the matter nor does it collect any statistics on the use of insurance. For consumers such products have the advantage of providing direct recourse from the insurer when problems arise rather than having to rely on the insurances of the builder/developer or other parties.
The recently transposed EU Solvency II Directive prohibits Member States from interfering in relation to the pricing or terms and conditions of insurance products. Therefore while it would technically be possible to introduce mandatory latent defects insurance, this could have a potentially inflationary impact on the cost of housing delivery. Furthermore mandatory insurance would not necessarily increase levels of compliance with Building Regulations, rather it would provide compensation and recourse where defects were identified after by homeowners after completion.
My Department has focussed on implementing reforms to ensure strong and effective regulation in the building control system and the construction industry. The building control reforms introduced provide insurance underwriters with sufficient confidence to cover risks at prices which are sustainable and which the market can bear.
