As Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products. Consequently, although I am aware of concerns in relation to the financial strain which the cost of insurance may place on the operation of agricultural marts, I am not in a position to direct insurance companies as to the pricing level or terms or conditions they should apply to a particular sector.
Nevertheless, it is possible for the State to play a role in helping to stabilise the market and deal with factors contributing to the availability and cost of insurance. What was recognised with the establishment of the Cost of Insurance Working Group (CIWG) was that the environment within which insurers conduct their business can be better shaped, in order to make the Irish insurance market a more competitive one and also make it more attractive for new entrants. Building upon the work undertaken in the completion of the Report on the Cost of Motor Insurance, the second phase of the CIWG, as you are aware, culminated in the publication of the Report on the Cost of Employer and Public Liability Insurance in January 2018.
This report makes 15 recommendations with 29 associated actions to be carried out, set out in an Action Plan with agreed timelines for implementation. The three main themes in these recommendations are increasing transparency, reviewing the level of damages in personal injury cases and improving the personal injuries litigation framework.
Although the agricultural mart sector did not form part of the formal consultation process for the report, previous relevant representations from yourself and the chairperson of a marts association were taken into consideration by the CIWG. In addition other relevant stakeholders consulted with by, or providing submissions to, the CIWG, were representatives from the Irish Farmers’ Association and Meat Industry Ireland, as well as the main provider of insurance for the mart sector in Ireland.
Also, I am aware that my colleague, the Minister of State for Financial Services and Insurance and Chair of the CIWG, Mr. Michael D’Arcy T.D., met with representatives from the Marts Committee of the Irish Co-operative Organisation Society (ICOS) in March 2018, subsequent to the Report’s release. I understand that the ICOS agreed at this meeting that health and safety was one of the key considerations for insurers when assessing risk and that there was a level of responsibility by mart owners in this regard. I have also been advised that mart owners generally have been reassessing practices on foot of previous experiences of claims submitted against marts and, accordingly, implementing relevant improvements in management practices and standards of facilities in order to seek to avoid such situations arising again.
Finally, the most recent quarterly update on implementation was published on 12 November 2018 and shows that of the 19 actions from the Report on the Employer and Liability Insurance with deadlines up to and including Q3 2018, 18 have been completed. I would like to assure the Deputy that the CIWG Group will continue to focus on implementing the recommendations of the Report on the Cost of Employer and Public Liability Insurance in parallel with implementing those from the Motor Report. I am hopeful that the cumulative effects of the completion of the two Reports’ recommendations will include increased stability in the pricing of insurance for businesses and, of particular relevance to the mart sector, a broader and more competitive insurance market.