DÁIL QUESTION addressed to the Minister for Finance (Deputy Michael Noonan)
by Deputy Clare Daly
for ORAL ANSWER on 29/09/2016
To ask the Minister for Finance the steps he is taking to address spiralling insurance costs and the allegations that price signalling by insurance companies is leading them to increase insurance costs to a point that those costs are threatening the capacity of many small businesses to continue in operation.
The Cost of Insurance Working Group, which I chair, is undertaking a review of the factors which are influencing the increased cost of motor insurance.
The Working Group brings together all the relevant Departments and Offices involved with the process. Its objective is to identify immediate and longer term measures which can address increasing costs, while bearing in mind the need to maintain a stable insurance sector.
The core areas to be examined by the Working Group in this first phase are:
The motor insurance sector generally, at present and in recent years
The effects of legal costs and litigation processes on insurance costs
The current claims compensation arrangements and the cost of claims
Insurance data and information
The impact of accident rates
The impact of unlawful activity on the insurance sector
Other market issues
Because the issue of the cost of insurance is complex and in order to get to the heart of these issues as soon as possible, I have established four subgroups to review them in detail. Chairs have been appointed to these sub-groups and work has commenced. The subgroups are meeting weekly and their outputs are feeding into the meetings of the Working Group.
Separate to the working of the Cost of Insurance Working Group, the Competition and Consumer Protection Commission (CCPC) has informed me that it has formally opened an investigation in August 2016 concerning suspected breaches of competition law in the motor insurance sector. The investigation relates to industry participants openly signalling up-coming increases in motor insurance premiums in the State.
The CCPC is the independent statutory body responsible for enforcement of competition and consumer protection legislation across the economy. Its investigation is separate from the issues being considered by the Cost of Insurance Working Group and does not interfere with the important work being undertaken there.
By the end of October the Working Group will provide the Minister for Finance with an update report which will set out the priority actions required. From November to December, the Working Group will then develop an action plan to enable the relevant Government Departments and Offices to commence the implementation of these priority actions. In this regard I will be consulting regularly with Government colleagues.