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 Header Item Commission for Regulation of Utilities (Continued)
 Header Item Business Insurance: Motion [Private Members]

Wednesday, 13 March 2019

Dáil Éireann Debate
Vol. 980 No. 8

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(Speaker Continuing)

[Deputy Dara Calleary: Information on Dara Calleary Zoom on Dara Calleary] As a former Minister of State with responsibility for enterprise, I reiterate that it is not good enough for the Minister to be sitting on the fence in respect of this project, leaving 130 jobs in abeyance and €95 million of investment literally in the ground. It is a project in respect of which many people were very happy to have their pictures taken. The project is needed for regional development and national targets in the area. I accept the independence of the regulator but it cannot be unaccountable either. I will pursue its appearance before an Oireachtas committee but the Minister's Department should engage and see if our pathway to reaching national targets in combined heat and power are being affected by the way the regulator does its business.

Deputy Richard Bruton: Information on Richard Bruton Zoom on Richard Bruton Under this scheme, we give a premium payment on the basis that high-efficiency combined heat and power is delivered. A biomass combustion generating electricity would get a much lower rate of electricity pricing if it did not meet certain criteria setting it aside as high-efficiency combined heat and power, displacing fossil fuels and so on. That is the basis on which the premium is payable and the state aid rules underpinning that are approved by the European Union. When it comes to the interpretation of whether a project has met those standards, it must done independently of the Government. Those are the established rules of the renewable energy feed-in tariff, REFIT, 3 scheme. Somebody must independently assess each project to see if it is delivering efficiencies, carbon reductions, fossil fuel replacement and so on that were intended by giving this additional state aid to it. The CRU does that.

I am fully confident the commission does this in a fair and objective way. I have not seen the papers surrounding this and it would have been improper if I had seen them as it is entirely a matter for the CRU. Every project that comes in is fairly evaluated against these rules. Many projects have come in and been evaluated and not all are getting 100% certification. The Deputy has correctly said we must be attentive in achieving our climate targets, and I am determined to step up the pace of achievement for those targets, but it does not mean a Minister will interfere in the way in which existing rules or new rules developed to promote decarbonisation will be applied. This must be independent of the Government, and that is what the CRU is doing.

I know the Deputy wants more of an explanation but I can only offer the information I gave already. Either the company should approach the CRU or the Oireachtas could ask the CRU to explain how it handles these applications.

Business Insurance: Motion [Private Members]

Deputy Michael McGrath: Information on Michael McGrath Zoom on Michael McGrath I move:

"That Dáil Éireann recognises that:
— micro-, small- and medium-sized enterprises currently employ over one million people in Ireland according to the Central Statistics Office (CSO);

— the cost of employer liability insurance and public liability insurance is a direct threat to the competitiveness and sustainability of many businesses throughout the country, including, micro-, small- and medium-sized enterprises, sports clubs and facilities, charities, community and voluntary organisations, play centres, livestock marts, pubs and bars;

— the National Competitiveness Council has cited the cost of doing business in Ireland as a major concern, and that hidden costs such as insurance remain a pressure point for businesses;

— the Report on the Cost of Doing Business from the Joint Committee on Business, Enterprise and Innovation placed insurance front and centre as an issue for ‘most business organisations’;

— many businesses are reporting large increases in employer and public liability insurance premiums, many more cannot even obtain a quote, forcing them to self-insure, which puts both businesses and claimants at risk, and large increases in insurance excess and a greater use of insurance exclusions have also been reported;

— the Personal Injuries Commission (PIC) has confirmed that the data shows personal injury claims in Ireland are out-of-sync with other jurisdictions;

— the PIC recommended that corrective action is required to bring personal injury damages back in line with other jurisdictions, that the Judicial Council Bill 2017 be progressed through the Houses of the Oireachtas as quickly as possible and that a judicial council should bring forward guidance on the level of personal injury damages;

— the Personal Injuries Assessment Board (PIAB) was established in 2004 to provide an alternative dispute resolution mechanism to assess personal injury claims to often costly adversarial court proceedings;

— 33,114 applications were received in 2017 by PIAB, only 6,788 awards out of 12,663 made were accepted, and the remaining cases were dealt with outside the PIAB process;

— there is currently no data collected tracking the changes in premiums for employer liability and public liability, which means the problem remains under the surface;

— insurance fraud is one of the many reasons why insurance premiums are high, and there is currently no data collected on insurance fraud, be it from the Garda PULSE insurance fraud statistics or from the Courts Service;

— the insurance fraud database has yet to be established, the original deadline has been missed, and no new deadline has been put in place;

— in many instances, insurance companies are not challenging claims they believe to be dubious and potentially fraudulent; and

— insurance companies use non-disclosure at the point of a claim rather than at the policy proposal stage in order to avoid the payment of a claim;
and calls on the Government to:
— fully establish without delay the national claims information database inclusive of public liability and employer liability and an integrated insurance fraud database which includes the number of complaints made to An Garda Síochána, the number of cases brought by the Director of Public Prosecutions (DPP), the number of convictions made at both District and Circuit Court level, and the penalties and the sentences handed down;

— legally oblige insurance companies to notify policyholders of claims made against them as claims are made, to inform policyholders of the amount a claim was settled for and the reasons why the claim was settled, and to provide a breakdown of the premium;

— outline a timeline for the implementation of each of the 14 recommendations made by the PIC regarding personal injury awards;

— immediately commence recent legislative proposals passed by the Oireachtas which will require that PIAB update the Book of Quantum every three years or sooner;

— apply pressure to the insurance industry to be forthcoming with data in order for the Department of Finance to complete a key information report on public liability and employer liability insurance claims;

— urgently advance the Judicial Council Bill 2017 to establish a judicial council and establish an interim framework, inclusive of PIAB, to enable the judiciary to complete guidelines in advance of the establishment of the judicial council;

— fully fund and resource a dedicated Garda fraud unit, facilitate the passage through the Oireachtas of the Civil Liability and Courts (Amendment) Bill 2018, so that fraudulent or exaggerated claims are reported to the DPP and bring in tougher penalties for such claims;

— undertake analysis on the potential options for micro-, small-, and medium-sized enterprises which cannot obtain public liability or employer liability insurance from any company operating in Ireland;

— urgently work with the CSO to bring forward an objective measure of the level of public liability and employer liability insurance;

— urgently tackle the 18 outstanding action points in the Cost of the Insurance Working Group’s Reports on Motor Insurance and Employer and Public Liability Insurance, including the action points marked ‘Concluded (for CIWG)’; and

— work towards creating a single European market for insurance to better enable businesses to shop around for employer and public liability insurance."

I will share this speaking slot with six Deputies. I will take seven to eight minutes and they will take approximately two minutes each.

An Leas-Cheann Comhairle: Information on Pat the Cope Gallagher Zoom on Pat the Cope Gallagher Is that agreed? Agreed.

Deputy Michael McGrath: Information on Michael McGrath Zoom on Michael McGrath Before getting to the subject matter at hand, I warmly welcome students and staff from St. Peter's community school in Passage West , County Cork. It is the school I attended so I am delighted they are here in Dáil Éireann and able to witness this debate. I wish them well.

An Leas-Cheann Comhairle: Information on Pat the Cope Gallagher Zoom on Pat the Cope Gallagher Cuirim fáilte rompu.

Deputy Michael McGrath: Information on Michael McGrath Zoom on Michael McGrath The focus of this motion is employer liability and public liability insurance. It is not that everything is fine in the area of motor insurance, as it certainly is not, but the focus of the motion is in respect of employer and public liability. For businesses, voluntary organisations, community groups, sporting bodies, livestock marts, festivals and so on, there is a real crisis regarding this matter. I welcome to the Gallery many people directly involved in those sectors, including proprietors of play centres, pubs, nightclubs and hotels. They have taken time from their own businesses to be here because of the importance of this matter. We are at a crisis point.

Any business with a significant public footfall, whether it is a pub, a nightclub, a hotel, a children's play centre or a leisure centre, is experiencing very significant increases in the cost of insurance. The reality is that the cost of insurance has closed businesses and it has done so repeatedly. I know three centres have closed in the past month, with the cost of insurance being the main factor. I can give one example of a play centre that has not yet closed but that will do so unless something changes. Its renewal is in March every year. In 2016, the cost of insurance for this business was €3,500; in 2017 it was €5,500; in March 2018 it was just under €10,000; and it has just received a renewal notice in the post for €18,500 for insurance for the next 12 months. If nothing changes within days for that business, it will close with the loss of employment and a vital amenity within the community. We cannot allow that to happen.

This is not about preventing legitimate claims from being dealt with and of course legitimate claims must be processed on a fair and even-handed basis. We are really lacking certainty when it comes to awards, however, as there is a lack in consistency. In July, the Personal Injuries Commission published a final report and its central recommendation was that there should be a judicial council established that could issue guidelines for appropriate damages in respect of personal injuries. It demonstrated through empirical evidence that with respect to soft tissue claims, including whiplash, the award levels in Ireland are 4.4 times the levels in England and Wales. The average awards are over €17,000 here against approximately €3,800 in England and Wales. We have the hard evidence now.

Where is the process now of setting up that judicial council? The Bill to establish that judicial council was brought forward in 2017 but it seems to be stuck in the mud somewhere since November of that year. We need to deal with the fact that award levels in Ireland are significantly out of line with other jurisdictions. Is it the case that the Minister's colleague, the Minister for Transport, Tourism and Sport, Deputy Ross, is preventing the Bill from being brought forward in the Seanad because of the delay with the Judicial Appointments Commission Bill? We deserve straight answers as to whether that is the case. I cannot explain to the people contacting me why the Bill has not been progressed despite dealing with the central issue of award levels, which must be dealt with as a priority.

Where a claim is made against a business, it is hampered in its ability to defend the claim. Somebody can rock up as many as two years after an alleged event took place to submit a claim. On the other hand, the Data Protection Commissioner confirmed to us today that the business should only keep closed-circuit television, CCTV, records for 30 days. If somebody comes in on the eve of the second anniversary of an alleged incident saying he or she fell in the bathroom of the premises on a certain date, there would be no CCTV footage for the dance floor, the entrance to a facility, the playing area and so on. The business would be unable to defend itself, which is a key matter to be addressed.

Insurance companies are not providing information to policyholders in respect of claims being made against them. That issue must be dealt with and people should have the right to know when a claim is made against their policy. They should be given information about the settlement process and where awards have been made. It is not being done, and we have seen evidence of that for many cases.

There is also the matter of fraudulent and exaggerated claims. This is a serious problem and it must be addressed. We still do not have an insurance fraud database, which had been promised, and over two years ago a Garda insurance fraud unit was recommended but I am not sure what happened since. There was a debate for approximately two years as to whether the insurance industry should fund it but we now know it will not do so because the Garda Commissioner does not want it funded that way. Where is it and will it happen? We cannot even get information about the number of prosecutions brought in this State in respect of fraudulent insurance claims. Neither the Courts Service nor the Garda can tell us; there are no records and no information is being made available.

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