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Dáil Éireann debate -
Wednesday, 21 Mar 2018

Vol. 966 No. 8

Business Insurance: Motion [Private Members]

I move:

That Dáil Éireann:

recognises that:

— micro-, small- and medium-sized enterprises currently employ nearly 970,000 people in Ireland according to the Central Statistics Office, which represents around 44 per cent of all those employed;

— the cost of doing business in Ireland has been cited by the National Competitiveness Council as a major concern;

— many businesses are reporting large increases in employer and public liability insurance premiums;

— 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;

— the greater use of insurance excess and insurance exclusions is increasing the cost of insurance by the back door;

— without urgent action, insurance premiums will soon become unsustainable for many businesses;

— as a result, a greater number of businesses will not take out insurance at all and this practice is extremely risky and threatens the viability of the businesses involved;

— 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;

— the Cost of Insurance Working Group has set a deadline of the end of 2018 for the feasibility study for creating such an index, which implies that the index will not be in place until well into 2019 if not later;

— the Central Bank of Ireland has a deadline of the end of 2019 for a feasibility study on whether employer liability and public liability insurance data should be included in the National Claims Information Database;

— insurance fraud is one of the many reasons why insurance premiums are high and no data is currently published by the Courts Service on the number of instances of fraudulent and exaggerated claims;

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

— there is a real or perceived lack of consistency in the awards handed out for personal injury claims;

— the second report from the Personal Injury Commission on benchmarking personal injury claims in Ireland versus other jurisdictions is urgently required; 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:

— urgently tackle the 15 action points in the Cost of the Insurance Working Group's Report on the Cost of Employer and Public Liability Insurance that are due to be completed in the first half of this year;

— legally oblige insurers to provide a breakdown of the premium cost to the business and to provide more information to the business on how premiums are calculated;

— ensure that the Personal Injuries Assessment Board (PIAB) Book of Quantum is updated at least once every three years;

— ensure that the research on the PIAB Book of Quantum is based on medical evidence and cost, not solely on historic claims;

— bring forward the deadline for the feasibility study on including employer liability and public liability data on the National Claims Information Database from the fourth quarter of 2019;

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

— bring in tougher penalties, both financial and otherwise, for insurance fraud and claim exaggeration;

— establish a declined insurance mechanism for employer and public liability insurance;

— legally oblige insurance companies to notify policyholders of claims made against them before settlement, the amount a claim was settled for and the reasons why the claim was settled; and

— bring forward the deadline for the Department of Finance and the Central Statistics Office to report on the creation of a price index for employer and public liability insurance premiums, and urgently establish such an index.

I am pleased to introduce the Fianna Fáil motion on business insurance. We are calling for urgent action from the Government to tackle rising insurance costs for businesses, particularly SMEs. I acknowledge all those in the Public Gallery who are directly affected by this issue. I thank Deputy Moynihan for the work he has done in highlighting this issue within the party and demanding that we take action.

The overall message for the Minister of State, Deputy D'Arcy, is that this issue must be a priority for Government. There is an enormous amount of anger and, indeed, frustration at the lack of progress in dealing with rising insurance costs. The Minister of State may talk about reforms that are due and being prepared for 2019 and 2020 but they are of no comfort to businesses that are struggling today and do not know how they are going to renew their insurance policy because they simply may not be here in a year or two years. This is also an issue for sports clubs, voluntary groups and community organisations. It is seeping into so many different strands of Irish life.

The increases in insurance premiums are dramatic for many businesses, particularly those in the retail and hospitality sectors, in particular pubs, restaurants, hotels and nightclubs. We do not have any CSO data unlike motor insurance but we have many real-life examples. I have heard so many of them. In the past couple of years, one business's premium increased from €10,000 to €25,000 while that of another business increased from €18,000 to €31,000. The premium for a large hospitality business like a hotel or nightclub could increase from €80,000 to €230,000. That is the reality.

Those are just the changes to premiums. There are also changes to excess levels and exclusions are increasingly included in these policies. In many cases, the excess can be €10,000 to €20,000. Of course, it is very easy for an insurance company to make an award of up to the excess level because that is paid by the policyholder and not by the insurance company. There are many instances of exaggerated and downright fraudulent claims being settled instead of being challenged. This is what is happening in reality. There are cases where policyholders have pleaded with the insurance companies to contest and challenge claims only to find out that a payout has been made behind their backs. In some cases, they are not even aware that a claim has been made. This is not an attack on legitimate compensation claims. There will always be accidents and those claims need to dealt with fairly and appropriately.

There is no transparency around how premiums are set by the insurance industry, how claims are settled and the settlement amounts themselves. We urgently need to fill the data gap. We need the national claims information database and a price index relating to employer liability and public liability insurance. We need to get tough with insurance fraud. We cannot even get the data about the number of cases that have been taken against people who have made fraudulent claims. That needs to be fixed immediately and we need tough penalties. People need to be referred to the gardaí and taken to court where they have made fraudulent claims. Where is the specialist unit for dealing with insurance fraud that was promised for An Garda Síochána? That needs to be dealt with. There are members of the legal profession who have questions to answer and who are doing a disservice to their profession by taking claims they know have no substance whatsoever. Award levels urgently need to be benchmarked internationally. We need consistency in the level of awards. One of the reasons insurance companies settle claims is because they have a fear of what will happen if they go to court and the level of award that will be made. We need to move to a system of care, not cash in many cases. That would be the game changer in our view.

We support the work of the Personal Injuries Commission. We believe that there is a need to review the statute of limitations. At present, a person has two years to lodge a claim from his or her date of knowledge of an injury. However, in general, a business is only allowed to keep its CCTV records for one month so when a claim is made, a business might have had the evidence that it was a bogus claim but it now cannot contest it because one law is contradicting another law, which is a key issue.

Increasingly, people in business, and I know some of them, take the risk of having no insurance policy at all because of the cost of renewing their premium. It is a huge personal risk for them to take and it is not a road we want to see anyone going down.

The Government will have the full support of the Fianna Fáil Party if it genuinely seeks to tackle this issue. We have put pressure on the Government for the past couple of years regarding motor insurance, business insurance and insurance in the wider community sector. In parts of the hospitality sector there is no insurance competition, with Lloyds of the UK the only provider. That is a huge risk for those businesses. If that insurance firm decides to leave the Irish insurance market, where does that leave all those businesses and their employees?

We need urgency. I could cite several examples where there has been slippage in the recommendations. Many of the recommendations are soft enough anyway. They are about consultations and more reports, but people want action. Change is difficult, but we urge the Minister of State to call out those who are not playing their part and name them. We would support him in doing that.

I acknowledge the work of the Alliance for Insurance Reform which has played a very positive role in the issue so far.

Businesses will close and jobs will be lost. The lack of reform in the insurance sector is damaging the Irish economy. The Minister of State should use the mandate from this House to drive through the required reforms to bring some sense in the insurance market and protect Irish jobs.

I welcome the opportunity to speak on the debate. I thank Deputy Michael McGrath for his work on the matter. I welcome the people in the Public Gallery who have taken time out of their business to make a statement that they are crying out for insurance reform. The men and women in the Gallery can outline their own personal experiences with the cost of insurance in the hospitality business and in every aspect of business. They are looking for a roadmap to try to reduce the cost.

Many businesses are considering the possibility of trading without insurance and we all know what that leads to. We all know the dangers of that regarding personal guarantees on their own homes and everything else. They are looking at claims that have been settled. There is an old saying that he who pays the piper calls the tune. However, the policyholders only find out about the settlement of the claim when they go to renew their insurance. That is unacceptable. They may have questions over whether the claim was accurate or whether it was fraudulent.

In some cases insurance premiums have escalated by hundreds of percent. The powers that be are talking about reports in 2019, but that will be far too late for many businesses. These people will be looking for help to sustain their businesses. I could spend the next two hours of this debate talking about how people have been treated, and the legal and other costs to their businesses. Of course, many businesses are fronting up the first €10,000 of a claim and in some instances I have been informed of it being €30,000. All that has to be factored into their businesses.

We have to face down a number of issues, including the book of quantum for claims. There is disparity in how certain injuries are dealt with in different jurisdictions. We need consistency in that regard. Every policyholder needs to be informed of how that figure is calculated. They are sending out insurance policies and many brokers are working extremely hard to get underwriters to give the best deal. Many of the underwriters are leaving the Irish market and leaving thousands of people with escalating insurance costs.

We are asking for a roadmap. There is huge support in the House to move it forward. We want a roadmap to try to reduce the costs with immediate effect, not in one, two or three years' time. I am grateful for the opportunity to speak on the matter. It is a desperately serious issue and we need action on it now.

The Joint Committee on Business, Enterprise and Innovation, of which I am a member, is compiling a report on the cost of doing business in Ireland. All the witnesses who have appeared before the committee have flagged the cost of insurance as their number one item. That does not come as a surprise to any of us. However, the problem is that it is not getting any better. All the work that is going on and the work that is not going on are impacting on businesses every day of the week.

I know the Minister of State recently met representatives of the Alliance for Insurance Reform. I met them recently in Limerick along with some of my colleagues. Some of what they told us was truly staggering. For example, there is renewal brinkmanship in the road haulage industry with insurance providers waiting until midnight on the renewal day and then bumping up the premium by a couple of hundred percent without giving any notice. This happened to a haulage company with 30 or 40 trucks on the road. How can they continue to do business in a competitive environment when they are being treated like that by their insurance companies?

We need meaningful reform and engagement. We need care rather than cash. In particular we need new providers in the marketplace. The Government has a job of work to do to encourage new insurance underwriters into the Irish market because at the moment it is being dominated by a small number of people who are operating almost like a cartel in certain sectors.

The Alliance for Insurance Reform has advised the Minister of State of all the problems, and I am sure he knows many of them. That alliance represents various hoteliers, publicans, community and voluntary groups. The Minister of State knows the list. We need action as soon as possible or else vast sections of business will be negatively impacted, particularly businesses in rural areas which are struggling with so many other factors also impacting them. We need urgency from the Government in dealing with the issue.

As the Minister of State knows, the small and medium-sized enterprise sector is very important throughout Ireland. I am specifically concerned about the impact of Brexit on the Border counties. As my colleagues have outlined, the premiums for employer liability and public liability insurance are proving unsustainable for many small and medium-sized enterprises throughout the country.

The National Competitiveness Council has stated that the cost of doing business is a major concern for our overall competitiveness. Many of the SMEs have experienced business insurance increases of between 6% and 15% and in some cases much more. In addition, insurance companies are using excesses and exclusions to protect themselves at the expense of the customers.

For businesses, commercial rates and insurance premiums are two of the huge burdens potentially affecting their viability and sustainability. We are at a very crucial point with Brexit looming large in everybody's mind. As we know, our small and medium-sized business sector is the prime source of revenue in the country and we cannot ignore it. We cannot continue like this and I encourage the Minister of State to take on board this important motion. I compliment my colleague, Deputy Michael McGrath, on tabling it. The numbers in the Gallery indicate the interest in the matter. It must be addressed as a matter of urgency.

I welcome the opportunity to speak to the motion. Our small and medium-sized businesses are the lifeblood of the economy, whether it be in the retail sector, small contractors, the tourism industry or community groups. Instead of feeling supported, our small and medium-sized businesses feel they are being neglected by the Government, including on the issue of commercial rates, an issue we have raised here for a long time with no action.

In this debate we are talking about the exorbitant insurance premiums and the lack of Government regulation. Recently I attended the annual conference of the Irish Hotels Federation. That industry is very labour intensive and provides great jobs throughout the country. Delegates said that one of the biggest challenges facing their industry after Brexit is the issue of high insurance premiums.

Some of the stories that they shared with me about rate increases over the last months have been breathtaking. Some small businesses in particular are questioning how they will be able to survive in the future. While the Government has published recommendations from the cost of insurance working group relating to employee and public liability insurance, people want to see action with legislation for a cap on the level of personal injury awards. That is critically important. There needs to be a cap and the insurance industry needs to start to challenge some of the claims that have been submitted instead of settling out of court. There also needs to be tackling of the fraud and exaggerated insurance claims. Strong deterrents need to be brought in to ensure that people refrain from this. Anyone who is caught submitting a fraudulent or exaggerated claim should face serious consequences. I urge rapid action on this area.

I thank my colleague, Deputy Michael McGrath, for tabling this motion. We all know what is happening. There are two companies in my part of the constituency, in south Sligo, including a haulage company which employs 45 people and has an insurance cost this year of €135,000. There are 45 jobs at risk there and there is no question about it. In the hospitality industry, there is a small hotel which had insurance of €30,000. It has gone up to €65,000 this year. There is no question that unless this is dealt with very quickly, jobs will be lost and businesses will go out of business. With regard to motor insurance, I have a renewal certificate here. This company, AXA, is one of the most reputable companies in the country. Condition No. 3 on this certificate addresses limitations as to use, stating that it includes use for social, domestic and pleasure purposes, excluding cover for commuting to work. In the name of God, where are we going? This is in the small print of this insurance policy and this person needs a car to get to work. This is going on, and if people have an accident, they do not record it to ensure they retain their no-claims bonuses.

We heard insurance companies say that we have the penalty points system in place and that it will bring down the cost of insurance. It has not brought down the cost of insurance because people over 30 years of age with no penalty points are still paying much more than they were paying last year and the year before.

The Personal Injuries Assessment Board, PIAB, which was brought in maybe six or seven years ago, worked for a while and can work again but I understand that it has been bypassed by the legal profession. That needs to be looked at. These insurance companies should be brought into an Oireachtas committee and the questions should be put to them.

People in my community and communities throughout the country are at crisis point in trying to run their businesses because of the crippling cost of employer liability and public liability insurance. Whether self-employed people, tradespeople, companies or, indeed, as referenced by many others, voluntary and community enterprises, the cost of this type of insurance is proving to be unsustainable and will push many people out of business. We need to remember that there are in excess of 970,000 people employed in this sector across the country. The retail sector is the low-hanging fruit for insurance fraud and is the sector most susceptible to bogus claims. As a consequence of that, many struggle to pay the premiums and, as alluded to, they are contemplating self-insuring which is a major risk or a risk too far. There are no active deterrents for unscrupulous people who contemplate exaggerating their claims. Where people do this and it is found by the court, they should be referred to the Director of Public Prosecutions as a matter of fact. Others have referred to the book of quantum. My time is limited so I will not refer to that but just flag it again as others have. I would argue that there should be more involvement with policyholders in the settlement of claims and, as a priority, they should at least be informed of how much people are awarded so that there is more transparency. There is a need to deal with them head on in letting them know what is happening with claims. Somebody said that there is a possible cartel. It is my firm belief that a cartel is operating with no regulation in the industry and no competition in pricing. If we do not get to grips in this country with those spiralling and unsustainable insurance costs, the small enterprises and the business sectors referenced, for example, by Retail Excellence Ireland, Retail Grocery Dairy & Allied Trades Association, RGDATA, IBEC and the Small Firms Association, will soon be priced out of business.

I welcome the opportunity to address Dáil Éireann on the motion moved by Fianna Fáil on business insurance. The motion sets out many of the issues that have been raised and recognised by the cost of insurance working group, including the lack of availability of affordable business insurance. The Minister for Finance therefore does not disagree with much of what is contained in the motion and would like to set out what the Government is doing to address many of the issues raised.

On the context for the employer and public liability report, the difficulties being faced by many businesses in being able to obtain cover at a reasonable price was the main reason the Government agreed that in the second phase of its work, the cost of insurance working group, chaired by my colleague, the Minister of State, Deputy D'Arcy, would examine the factors contributing to increased costs of insurance to business, in particular employer and public liability insurance. The extensive consultation process that the working group engaged in with the business sector gave greater insight into these difficulties, particularly as to how they are impacting on competitiveness and sustainability. As a result, the working group's report on the cost of employer and public liability insurance makes 15 recommendations with 29 associated actions to be carried out. The recommendations and actions are detailed in an action plan contained in the report with agreed timelines for implementation. The recommendations, covering three main themes, include actions to increase transparency through enhancing levels of transparency and improving data sharing and collection processes, a review of the level of damages in personal injury cases through a Law Reform Commission examination, and improving the personal injuries litigation framework through a number of specified measures.

A key aim overall of both the report on the cost of motor insurance and the report on the cost of employer and public liability insurance is to try to ensure consistency of award levels through the regular use of the book of quantum. In essence, this should mean that no matter what way a claim is settled, whether directly by the insurer, through the Personal Injuries Assessment Board, known as PIAB, or as a result of a court decision, the outcome should be broadly the same. If consistency of awards can be applied in a broad sense, especially for soft tissue injuries, it should have two very significant effects. The first is that there should be less reason for cases to go to litigation as the level of awards granted by the courts will be aligned with those provided by PIAB. This in turn should mean a reduction in legal costs. Secondly, a stable claims and awards environment should mean that the reserves put aside by insurers to meet future claims would not have to be regularly adjusted to reflect new developments such as increases in award levels.

A common criticism received from business stakeholders was that award levels in the book of quantum were too high, particularly in respect of certain soft tissue injuries, compared with those in other jurisdictions and should be cut across the board. However, such a view ignores the fact that the book is a guide which merely reflects the prevailing levels of compensation in Ireland for various types of injury based upon what has actually been paid out in the courts, by the State Claims Agency, in direct settlements by the insurance sector, or awarded by PIAB. Currently, therefore, the only way that the award levels in the book can be lowered is if there is a decrease in the actual level of awards paid out. The report on the cost of employer and public liability insurance recognises the seriousness of this issue through its recommendation that the Law Reform Commission undertake a detailed analysis of the possibility of developing constitutionally sound legislation to delimit or cap the amounts of damages which a court may award in respect of some or all categories of personal injuries. While it is acknowledged that this will take some time, the parallel benchmarking exercise of personal injury awards in Ireland, with awards elsewhere being currently carried out by the Personal Injuries Commission, should add extra impetus to this debate.

There was also a general perception by stakeholders that the book was not being consistently adhered to by the Judiciary, leading to higher payouts. However, a revised version of the book was produced in October 2016 and this has alleviated the key complaint of the Judiciary itself, that the book had become irrelevant having not been updated for 12 years prior to that. The 2016 edition also includes additional injury categories and improved granularity of injuries. Moreover, the passing of legislation, the Personal Injuries Assessment Board (amendment) Bill, another recommendation of the report on the cost of motor insurance, which it is hoped will be later this year, will ensure that the book is reviewed every three years from now on.

There was a major focus in the second phase by business stakeholders on the claims settlement process. It was indicated to the working group that on occasion businesses only became aware at the time of renewal that a claim had been submitted against their policy and sometimes settled. There is a provision in law to ensure a defendant is informed as early as possible about a claim through the receipt of an initial warning letter. The letter is required to be sent under section 8 of the Civil Liability and Courts Act 2004 which provides that where a plaintiff fails to serve a notice on the defendant within two months of the date of an accident, the date of knowledge or as soon as practicable thereafter, he or she may be penalised in costs and, furthermore, the court may draw such inferences from the failure as appear appropriate. However, the working group believes the notification requirements are not being complied with in practice and that no subsequent penalty is being enforced, either in respect of costs or inferences being drawn. There is, therefore, a recommendation to strengthen the wording of section 8 in order to shorten the period of notification and make the penalty provisions more robust.

The relevant law in tackling fraud in a personal injuries context is the Civil Liability and Courts Act 2004. The working group focused on sections 14 and 25, which create criminal offences when false or misleading affidavits and evidence, dealt with in sections 14 and 25, respectively, are knowingly provided in a personal injuries case. It is proposed to amend section 14 such that a court will be permitted to draw inferences if the required verifying affidavit is not lodged within the allowed timeframe.

Attention was also given to section 26, which requires the court to dismiss a personal injuries claim when a plaintiff knowingly provides false or misleading evidence. The working group concluded that section 26 had been invoked on fewer occasions than would have been expected since the Act was commenced in 2004. It believes the provisions of the Act are largely fit for purpose and that the penalties are more than adequate, with fines of up to €100,000 or a term of imprisonment of up to ten years, but are not used to the extent to which they could be. Consequently, the recommendations made in this area relate mainly to encouraging the greater use of the existing provisions.

As regards the reportage, investigation and prosecution of alleged insurance fraud, the major recommendation is that a new set of guidelines be drawn up between Insurance Ireland, An Garda Síochána and the Director of Public Prosecutions. In particular, it should be ensured any case dismissed in court on the grounds of false or misleading evidence, whether under section 26 or otherwise, should at least be automatically considered for investigation by An Garda Síochána under section 25, notwithstanding the different thresholds to be reached in civil and criminal cases. The new set of guidelines will be drawn up in order to standardise and improve the development of cases for submission to An Garda Síochána. A previous protocol agreed to in 2004 between the Insurance Federation of Ireland and the Garda Bureau of Fraud Investigation on the reporting of suspected fraudulent claims represents a good starting point for the formulation of the new set of guidelines.

Overall, the working group strongly believes there is an onus on all insurance providers to become more proactive in tackling fraud, for example, by fighting dubious claims, investing more resources in detection, building up strong evidence bases and following up cases with An Garda Síochána at regular intervals.

The Government understands the motivation behind the motion and agrees with elements of it. We are not, therefore, bringing forward a counter-motion, but I point out that many of the steps called for in the motion are already being implemented pursuant to the reports on the cost of motor and employers' and public liability insurance. However, the Government has concerns about several points in the motion such as those related to the book of quantum and the declined cases mechanism for employers' and public liability insurance. In addition, the Government does not believe it is possible to bring forward the deadlines for the CSO price index or the national claims information database for business insurance. Owing to these concerns, the Government will abstain in the vote on the motion.

I move amendment No. 1:

(a) To insert the following after “in order to avoid the payment of a claim; and”:

"-- insurance contract law in Ireland is outdated and in many ways archaic;”

and

(b) To insert the following after “and urgently establish such an index.”:

“and

-- immediately provide a Money Message so that the Consumer Insurance Contracts Bill 2017 can proceed to Committee Stage.”

I am glad to hear that the Government will abstain in the vote, which means that the Fianna Fáil motion will be passed with the support of Sinn Féin. I acknowledge and welcome those in the Visitors Gallery who have come to listen to the debate.

Sinn Féin is happy to support the Fianna Fáil motion with the inclusion of our amendment which aims to free one of the many Bills brought forward by the Opposition that the Government is intent on burying. The Consumer Insurance Contracts Bill 2017 was drafted by our finance spokesperson, Deputy Pearse Doherty, and is aimed at addressing one of the many issues which contribute to the escalating cost of insurance for businesses. I hope Fianna Fáil and other parties will support the amendment, to which I will return.

Businesses are being bled dry by outrageous increases in insurance premiums which are forcing some low margin enterprises out of business. All Members will have been told by small SMEs and businesspeople that they cannot afford their insurance premiums because of the yearly increases. The CSO recorded an increase of 57% in insurance premiums between 2011 and 2016. The increase cannot be blamed solely on high pay-outs to meet injury costs. It requires reform of the way in which insurance companies operate. High pay-outs and fraud are not solely to blame, although they are contributory factors. Neither pay-outs for injuries nor insurance fraud is new, but the massive increases are. Therefore, I do not understand how the insurance companies expect us to believe everyone is to blame but them.

Insurance companies play a major role in the economy because they provide products such as motor, home and public liability insurance which many people are required to have. Because of their prominent and important position in the economy, insurance companies are not comparable to other undertakings and should be required to be far more transparent about their premiums and profits. Sinn Féin believes a much tougher stance can be taken by the Government with insurance companies. I have met the Competition and Consumer Protection Commission and raised this issue as a real concern. Its investigation of insurance companies is ongoing.

A number of businesses surveyed by Chambers Ireland for the latest report of the cost of insurance working group stated they had suffered increases of over 100% in their premiums, which is totally unacceptable. Some are being forced to opt for high excess levels in an effort to lower their premiums, something which can be very risky for a business if a claim is made. As other Deputies stated, some companies are not taking out insurance at all.

With Deputies Niall Collins and Tom Neville, I recently attended a meeting in Limerick of the Alliance for Insurance Reform. The non-political group brings together 20 civic and business organisations across Ireland which represent 35,000 members, over 633,000 employees and 41,300 volunteers, or a huge cross-section of people and businesses across the country who have been directly affected by increased insurance costs and forced to organise to try to fight back against the constant and unfair hikes in insurance costs. The Minister of State, Deputy Michael D’Arcy, met the alliance this week. After the meeting it expressed its intense disappointment at the slow pace of reform and stated policy holders had been thrown to the wolves by the Government. That is a damming indictment by a non-political organisation of the Government’s response to the massive problem of escalating insurance costs. It seems that the Government has been lobbied and taken in by vested interests and big business. That does not come as a surprise as Fine Gael is the party of big business, the wealthy and billionaires, including American billionaires whom it can help out when called on to so do, as the Taoiseach proved last week. I have no confidence that the Government will address the issue of escalating insurance costs, as it sees no benefit for it in so doing. The Joint Committee on Business, Enterprise and Innovation, of which I am a member, has for many years been examining issues related to the cost of doing business in Ireland. With Deputies Niall Collins and Tom Neville, I have invited representatives of the Alliance for Insurance Reform to come before the committee.

Insurance costs have repeatedly been cited by almost all commercial representative groups as a threat to the viability of businesses across Ireland. The Irish Small and Medium Enterprises Association, ISME, has described how insurance costs are not merely high but, rather, a threat to enterprises in sectors such as the hospitality, distribution and retail sectors. It has stated the solutions to the insurance cost problem are remarkably simple but politically challenging as they require the facing down of vested interests that view insurance reform as hostile to their livelihoods. The Small Firms Association, SFA, has stated small businesses are facing an insurance costs crisis, with 81% of SFA members having experienced a rise in premiums since last year. IBEC has stated the recent upward trend in annual premiums is proving to be unsustainable for low margin businesses, particularly those impacted on by Brexit. According to a survey conducted by the Irish Hotels Federation, over 80% of hoteliers have stated rising insurance costs are having a significant negative impact on their business.

Businesses will face huge challenges from Brexit in the coming years and simply cannot afford to have the additional problems and costs of insurance increases. We need real action now. A number of community groups have been affected. I have been contacted by groups that organise festivals that cannot do all the things they would have normally done due to their increased costs. One local community group in Limerick that had an insurance cost of €12,000 last year was given a quote of €50,000 this year. It was able to shop around and it got a premium of €40,000, which it struggled to pay. The money was paid out of its reserves so the group does not know how it will fund its insurance premium next year.

The Government's approach has been described as "death by a thousand consultations" and that is an accurate portrayal. Every time we raise this issue, we are referred to some new report, consultation, discussion or working group. We do not need any more of that; we need real and tangible action. The Minister will probably reply with the usual, unhelpful Government mantra - that the Government cannot do anything about insurance costs as such products are commercial in nature. That approach is of no use to anyone. Insurance policies are not the same as other commercial products. One cannot drive a motor vehicle legally in Ireland without buying an insurance policy. Private drivers and businesses with commercial vehicles are forced to pay whatever price an insurance company wants to charge with no avenue to challenge them. Due to the legal requirement imposed by the State in this particular area, the Government should - and indeed does - have a role and responsibility in this area.

I wish to speak briefly about the amendment we are tabling to the motion. Sinn Féin is proposing a very straightforward amendment to demand that a money message be provided to Deputy Pearse Doherty's Consumer Insurance Contracts Bill. The Bill would empower businesses against insurance companies by updating consumer contract law which is archaic. The Bill to which I refer is a part of what we need to be moving towards, namely, a new culture where the consumer is actually protected from the banks and other financial institutions. The Bill specifically deals with insurance contracts and implements a wide range of measures to rebalance the law in favour of the consumer. Laws designed for 18th century sailing merchants are overhauled and replaced with modern consumer-friendly laws. The archaic laws in force have resulted in a power imbalance where insurers hold all the cards. For example, an insurer could, under current law, refuse to pay out if a house burnt down because of an unrelated issue such as a burglar alarm not working. It also puts the onus on the insurer to ask for all the relevant information instead of leaving it to the customer to guess what information might be relevant. If the Sinn Féin Bill is passed, insurers would no longer be allowed to refuse payment due to technical issues or because a consumer did not know he or she was expected to volunteer information that was not sought.

This Bill is desperately needed to give the consumers a fighting chance. Insurers will also have to put their application forms and conditions in plain, intelligible language and, in any dispute, the consumer would be given the benefit of the doubt. As we know, the Government is using its power over money messages to frustrate the legislation coming from Opposition parties. The Bill was not opposed by the Government and it will be of great practical use to consumers and should not be delayed any longer. In conclusion, Sinn Féin is happy to support Fianna Fáil's motion, with the inclusion of a small amendment. We hope that Fianna Fáil can use its coalition deal with Fine Gael to force though real reforms in this area to help businesses.

I welcome Fianna Fáil's motion. Insurance is something that affects everyone in the State, especially people with small businesses. I read through the Minister's speech and while it is strong on rhetoric on what the Government is trying to do, it does not go to the core of the problem and address the issues. The problems we have in the insurance sector are a symptom of the broken economic model for domestic business in this country. There is not a focus on recognising that the domestic sector needs help. That goes to the core of everything we talk about in all our financial services and our banking policy is very similar.

The banks in this country failed and everything was done to maintain them and to bring them back on-board to make sure that the pillar banks became strong again. That was done at the expense of the ordinary people and many business people who lost their business and who were stressed out in recent years trying to pay exorbitant interest rates. We have the highest interest rates in Europe for business and domestic banking yet the banks get the money from the same place as every other bank in Europe, often at less than 0.5%, namely, the European Central Bank. That is an example of the problem and we have the very same issue when it comes to insurance.

Reference is made to insurance fraud in the motion and previous speakers referred to it also. I accept it is an issue, but it has always been a factor. However, the reason we have had the exorbitant increases in insurance premia in recent years is because of the economic crash. During the boom times the insurance companies invested all their reserves in various bonds around the world but those bonds failed. When that happened the insurance companies lost their money and now look who is paying the price - it is the ordinary business people we see in the Gallery and around the country, and the ordinary car insurers, namely, the young people aged 18 or 19 who are trying to get insured and are being given quotes of up to €5,000 and €6,000 in order to be able to go to work. The problem we have is that ultimately everything is done to protect the big corporate interests at the expense of the small players. That needs to be reversed. That is the action the Government must take to address the issue.

Many business people take a big risk. They put themselves on the line in order to try to do something because they have a vision of creating something better for themselves and creating a better future for the community in which they live. All of us, regardless of where live in this country, have an obligation to try to make the place around us better. The business community, in particular those involved in small and medium enterprises are at the coalface of doing that and great credit is due to them for the work they do. However, they are not supported. The broken economic model to which I referred earlier is at the very core of that. No emphasis is being put on sustaining the small business community in the long term.

There are five cattle marts at the moment in County Leitrim. The mart managers tell me that in many cases the insurance they pay has almost trebled in recent years. That is no accident. It is not because anyone had an accident in the mart. It is not because anything happened. It is because the insurance companies are trying to get back the money they lost on the bonds, gambling on international markets in the past ten years. The Government must recognise that reality and examine it.

Banks, insurance companies and the big players are using their power to grind down ordinary people. The only chance people have is for the Government to stand up for them. The job of the Government is to step in to be the arbitrator of last resort. The Government needs to fulfil that role but, unfortunately, it is not doing it. This evening's motion is very welcome because it calls on the Government to intervene. We cannot hide behind excuses such as fraud or anything else. Such reasons will always be there. The corporate sector will always find a reason to increase prices and increase profits. What is happening is profiteering on the back of ordinary small businesses around the country.

My colleague, Deputy Quinlivan, referred to the Bill introduced by Deputy Pearse Doherty, the Consumer Insurance Contracts Bill, which the Government accepted and which would help in this and in many other instances but is waiting for a money message from the Cabinet. When Bills are approved by this House they go to the Cabinet and if there is a cost on the Exchequer only the Cabinet can approve them. That measure is being used all the time to hold up good Bills that could move things forward. If the Bill were enacted it would ensure that insurance companies would not be able to hide in the way they currently can. It would ensure that they would have to be at least a little bit more honest than they are at present, which would be a considerable advance on the current position. We all know people who have had various insurance claims in their businesses relating to fires or other issues but the insurance companies use every possible excuse not to pay. However, it does not work the other way as people do not have an excuse not to pay them. That is the difference. We need to ensure the Government steps up to the mark and becomes the arbitrator of last resort and does something for the ordinary business people and the people of the country.

I welcome and support the motion. It is now clear that it will be assented to by the majority of Members. The question to be asked is what action will be taken as a result of its passing because, increasingly, we are seeing motions being passed by the House but little or no action thereafter.

The motion is very practical. It speaks to the concerns of business owners the length and breadth of the country. There is one line in it that I want to highlight. It reads: "Calls on the Government to ... legally oblige insurers to provide a breakdown of the premium cost to the business and to provide more information to the business on how premiums are calculated". We do not have transparency in the process on the cost of premiums for individual businesses and small business owners throughout the country. Until such time as we have transparency, all of the rhetoric and the work done for the cost of insurance working group's report will be for naught. We will not have transparency until the Minister tackles that dynamic and is able to see which inherent costs within premiums are to make provision for bad debts and claims against an insurance company and for super-normal profits.

I agree with previous speakers. The insurance industry is acting like a cartel. Insurance companies are not being transparent on the profits they are earning and if they are not being transparent on the profits they are earning, they can charge ordinary people whatever premiums they wish. If there is one entity in the country that seems to be the voice of all of the big guns, the international players which begin with the letter A, for instance, it is Insurance Ireland. In interaction with the finance committee on issues such as the book of quantum, the level and consistency of awards and the high cost of premiums the views of the insurance companies seems to have been articulated through one vehicle - Insurance Ireland. Because we do not see the names and faces, the insurance sector is able to hide behind Insurance Ireland and we still do not have transparency. That is partly the reason insurance premiums are so high. It is because the insurance companies are earning super-normal profits which are in-built in the cost of each and every premium paid throughout the land.

I want to refer specifically to the Minister of State, Deputy Michael D'Arcy's contribution. In speaking about the level and consistency of awards and the book of quantum he stated:

The first is that there should be less reason for cases to go to litigation as the level of awards granted by the courts will be aligned with those provided by PIAB. This in turn should mean a reduction in legal costs. Secondly, a stable claims and awards environment should mean that the reserves put aside by insurers to meet future claims would not have to be regularly adjusted to reflect new developments such as increases in award levels.

We do not know in real terms what reserves insurance companies put aside and until such time as there is that transparency, it is impossible to predict the level and consistency of awards. In other words, it is impossible to predict with certainty that it will result in a decrease in the cost of premiums for individuals and businesses.

There is still a long way to go and, to be fair to the Minister of State who was formerly a member of the finance committee, I do not doubt his bona fides in seeking to take action on the issue, but what we need is a sense of urgency on the part of the Government in an intervention by the State because it seems that the Competition and Consumer Protection Commission has only been tinkering at the edges. It does not appear to have weighed in or been imbued with the resources it needs to fully interrogate insurance companies to see whether they are acting as a cartel. What the Minister of State probably needs to tackle this issue is the resources to attract people from the private sector to organisations such as the Competition and Consumer Protection Commission and pay them commensurate salaries. I refer to forensic accountants and so on who would be able to go in and examine the insurance companies to see what they are doing on the inside. Until such that happens, I fear that we will be back here again in 12 months' time paying lip service to the people in the Visitors Gallery who have been listening to politicians like me talk for a long time about the cost of doing business and who want to see some action being taken at the end of the day. We have the Action Plan for Jobs 2018 which is Government policy but nowhere in it does it speak about the increasing cost of doing business in the domestic sector. We will bend over backwards to help an IDA Ireland backed company coming to Ireland. I say that as a former Minister of State at the Department of Enterprise, Jobs and Innovation. We will do everything for an Enterprise Ireland backed company, but what we now need to do is start to look after the companies, the challenges of which are represented by the motion and which want to see real action being taken now.

The motion is timely following the report in January of the cost of insurance working group on the cost of employers' and public liability nsurance. The report is the second piece of work from the working group, the first being the work it carried out on the issue of motor insurance. While there have been some small and welcome reductions in the cost of motor premiums, the motor insurance sector remains problematic and continues to impact on the cost of doing business and costs for ordinary citizens and households. The motion is comprehensive. I agree that there is an urgent need to implement the 15 action points referenced in the report of the cost of insurance working group. Of particular importance are the requests for legislation and Government action to legally require insurers to provide a breakdown of premium costs for a business and explain the basis on which premiums are calculated; that the Personal Injuries Assessment Board's book of quantum be updated regularly - I believe it is proposed that it be done every three years - and that it be based on medical evidence and costs, not solely historic claims; and that the deadline for the Central Bank of Ireland’s feasibility study be brought forward to provide for the inclusion of employers' liability and public liability insurance data in the national claims information database. The motion also rightly asks the Government to move towards the creation of a single European insurance market to increase competitiveness. In some of the discussion we looked at the impact of Brexit and so on on the entire market. The Central Bank has a particular role in that regard because one of the unique aspects of the insurance business is that quite a few of the big players, the names of which, as my colleague, Deputy Sean Sherlock, said start with the letter "A", are not regulated by the Central Bank. I believe the regulator is the Bank of England. That is another bizarre aspect in trying to regulate the insurance industry in this country.

Soaring insurance and legal costs are putting a strain on businesses across the country and the position is particularly tough for small and medium enterprises, SMEs. The Chambers Ireland cost of insurance survey in August-September 2017 reported that 43% of respondents had seen an increase of between 5% and 20% in their premiums. Worryingly, a small percentage had reported increases of between 50% and 100%. In some cases there was more than a 100% increase. The justification given in 64% of cases by the brokers for the increases included "market conditions", whatever they are, and in 10% of cases "overall increases in claims", which one would imagine is much more important. Businesses, first and foremost, have legal responsibilities to their workforces, customers and the general public.

National Competitiveness Council Ireland's Competitiveness Challenge 2017 report, published last December, also highlighted increased insurance costs as having a serious impact on our competitiveness.

It also mentioned the lack of transparent data available in this sector and the problems with international comparisons owing to the nature of insurance and its role in business, including the fact that "the final price charged is generally not publicised." This comment understates the position in the insurance market. The National Competitiveness Council's report made some of the same recommendations that are included in this valuable motion. I welcome the action plan in the report which outlines the deadlines, relevant bodies responsible and lead or owner of each action. This is the approach that must be adopted.

Anyone who had been involved in the running of a small business, including many Deputies, or has served or serves as a company director will know the impact of employer and public liability insurance costs on a company's annual expenditure, especially over the past decade. While directors at meetings often urge managers and chief executive officers to shop around, the Irish market is characterised by limited competition despite the operation here of a number of large multinational insurers.

A feature of the business insurance market and other insurance markets in Ireland is the dearth of data available from the insurance industry and Courts Service, to which the motion correctly alludes. Astonishingly, there are also few data available from the Central Statistics Office and Personal Injuries Assessment Board. This public data vacuum damages the ability of the Oireachtas to legislate and conduct its business. The relevant organisations must produce the data we need to be able to track the insurance industry. There is good evidence that in the five and a half year period from January 2011 until July 2016 insurance costs in general increased by 57%. During the same period, approximately 42% of non-motor related PIAB applications were related to employer liability insurance and public liability insurance, with the figures for each being 15% and 27%, respectively.

Insurance Ireland's fact file 2016, the most recent fact file available, reports that Insurance Ireland's 18 domestic non-life members wrote gross premium of €3.253 billion in 2016, which was 13.7% higher than in 2015, whereas gross incurred claims were €2.09 billion or 0.5% lower than in 2015. The fact file shows a relentless rise in Insurance Ireland's members' gross non-life premium income between 2012 when it stood at €2.43 billion and 2016 when it stood at €3.25 billion. The significant portion of GDP represented by the insurance business, which has a workforce of more than 15,000 people, shows the significant impact insurance has on all aspects of the economy and society. I understand the sector accounts for approximately 6.5% of total GDP. It is striking that the most recent fact file from Insurance Ireland shows that in terms of insurance density and the premiums per capita in 2016, Ireland is ranked alongside countries such as Switzerland, Hong Kong, the Netherlands, the Cayman Islands and Luxembourg. Measured in US dollars, the total insurance cost per capita in Ireland stood at $4,408 in 2016, which was higher than the figure for the United Kingdom, Norway and Australia and much higher than the equivalent figures in European Union partners such as France. There is clearly a problem in this area and the Minister must urgently pursue the remedies outlined in the motion.

We cannot discuss insurance premiums without mentioning the legal costs associated with the sector. In the Department of Finance's work on motor insurance it was found that such costs account for 42% of the compensation amount paid to claimants. For example, a €100,000 compensation payment will also incur an average further payment of €24,900 for legal and other costs and a further €17,200 for insurer legal and other costs, giving a total payment by the insurer of €142,400.

Towards the end of 2016, reports indicated that insurance fraudsters from the United Kingdom were coming to Ireland to cheat the system and obtain much higher claim payouts than in the UK. In one case, the book of quantum payment in Ireland for a broken femur was 318% higher than the equivalent figure in the UK. The book of quantum shows vast differences in awards in Ireland compared with the United Kingdom, the market with which we are most heavily involved, notwithstanding Brexit.

As previous speakers noted, one of the key aspects of the report is the lack of transparency across the insurance sector. The importance of improving transparency in the sector is mentioned a number of times in the working group's report. This relates in particular to the Courts Service where the dearth of information is very concerning. Most citizens will ask why there is no easily available register of awards by the courts. As has been observed in traffic law and other important areas of law, it is astonishing and unacceptable in the digital age that we do not have transparent and reliable data to help Ministers to plan policy.

The insurance industry must take some responsibility for the terrible strain it is placing on small and medium enterprises. Last July saw dawn raids by the European Commission on Insurance Ireland, brokers and insurers. The European Union's Directorate-General for Competition has investigations ongoing into whether there has been a cartel operating in our motor industry. It is important that these European initiatives continue and the other important actions called for in the motion are supported.

I support the motion and urge the Government to speedily implement the 15 recommendations in the working group's report in order that we may begin to see some reduction in the horrendous business insurance costs.

I thank Deputy Broughan for observing the time limit. The Rural Independent Group has seven rather than nine minutes' speaking time because it is the group's turn to give Deputy Fitzmaurice two minutes of its time.

I am pleased to have an opportunity to speak on the motion. I have raised the issue of insurance many times in this Chamber. Small and medium local businesses and community and voluntary groups in my constituency of Cork South-West are crippled by constantly increasing insurance premiums, whether for property, vehicle or public liability insurance. Small business owners, self-employed persons and entrepreneurs keep the country on its feet, employing 970,000 people or 44% of the total workforce. Rural towns depend on local businesses, small pubs, post offices and Garda stations, yet these continue to decline in number because of consistent increases in rates and insurance costs. I know of garage owners, publicans, car owners and farmers who cannot pay their insurance premiums. Many are taking a chance and operating without insurance.

Only a couple of weeks ago, representatives of the hotel industry informed a committee meeting that insurance premiums for their members had increased by tens of thousands of euro through no fault of their own. Nightclub owners are being put out of business and rural towns are dying as a result of the unsustainable cost of doing business.

I support the motion and hope the cost of insurance working group's report will be implemented without delay. Businesses are closing daily and it is high time the Government did something to address the problem.

Insurance companies should be legally obliged to notify their customers of an expected increase in premiums prior to the renewal date. This would give them ample time to shop around or reallocate finances to cover the costs of the increase, rather than forcing them to close at the last minute or continue without insurance, as occurs in some cases. Time and again, Opposition motions, including a recent motion from the Rural Independent Group, have been introduced pleading with the Government to introduce some form of regulation for the insurance industry. The Minister of State set out a number of reasons for the high cost of insurance, including outcomes of court cases. The bottom line is that insurance bills are not reducing. We can talk about the issue until the cows come home but there is no benefit in proposing motions if we do not take action to resolve the problem. Is the Government listening and working to ensure the insurance industry sits up and listens to people who are suffering on the ground?

While I understand the reason for the applause, there must be no applauding from the Public Gallery.

I thank Deputies Michael McGrath and Moynihan and other Deputies from the Fianna Fáil Party for tabling the motion. I warmly welcome the representatives of 200 businesses who are present in the Public Gallery. It is important to recognise them, many of whom I know. Looking up at the Gallery, I realise that all those present are extremely busy people who improve the lot of their communities by creating wealth and employment. They do not need to be here.

I am grateful that the Fine Gael Party has woken up and agreed not to oppose the motion. While it at least has the common sense not to oppose the motion, someone should apologise for the sorrowful sight of the empty Government benches. This sets a bad example and provides an indication of the seriousness with which the Government treats the issue of business insurance costs. Fair dues to the Fianna Fáil Party for introducing the motion. I compliment it on doing so.

Over the years, I have pointed out that insurance costs are out of control and premiums are putting respectable business people out of business and, worse still, preventing them from expanding their businesses, driving on and creating more employment.

That is what we want, so the Government is letting itself down tonight because its Members would not sit in on the debate and hear what has been said.

I thank people like Mr. Declan Ryan in my own community. I thank Mr. Willie McClure from the South Kerry Advertiser, who has highlighted this matter over a long period and has done some excellent reports on it. I thank all the people for coming here today from around the country. I thank our neighbours from the Cork side but most important are the people coming from County Kerry. I thank them all very much.

The passing of this motion means a certain amount but I was involved with the Rural Independent Group when we passed a very important motion concerned with the protection of our post offices. It was passed and every Member in the House, including those from Fianna Fáil, Sinn Féin and the Government, supported it. Has that really protected our post office network? No, it has not. I welcome the fact that the motion will pass and it is the most that Fianna Fáil could do tonight. I ask that there be action afterwards and this will not just amount to lip service. I hope this will mean the premiums that business people are paying will be reduced and people will be able to continue expanding their businesses.

Am I sharing time?

No. The Deputy has a minute or so left but he does not have to use it.

No, I think I will be able to use it all right. I have seen first-hand the blackguarding that has gone on between the medical and legal professions, as well as the nonsense we can see when we compare awards in England and Ireland. What is happening out there is crazy. There seems to be people who have homing devices for finding misfortune. There are people living in places where they have had the misfortune to find not just one hole on one occasion but maybe five or six different holes in different places. For some miraculous reason, these people cannot see a hole but they fall into it. They sue local authorities then they go to a nightclub, where they have the massive misfortune of missing a step and falling all the way down the stairs. The question is whether they really fall or not. At the same time, somebody must pay for it. What is going on is disgraceful. Just because insurance companies are paying out the money does not mean this is not fraud or robbery. It is the same as putting one's hand into somebody else's pocket and taking their money. We are paying the price at the end of the day.

I have no problem with genuine claims and as far as I am concerned, the people seriously hurt in road accidents or accidents at work do not get enough money at all. I am talking about bogus claims. These are the people who get a small tip to the back of a car and instead of getting out and saying they are fine and the old bumper can be fixed and is grand, they go around holding their necks for six months afterwards. When the court case is settled, all of a sudden the neck is fine and these people are out disco dancing the next week, looking to see where they will fall again and have another claim. There are serial complainants and people making a living out of this type of racket. How they live in such a way I do not know. It is wrong and horrible. It is our job as legislators to try to stand up against this. We must stand up for the business people as at the end of the day they create work and wealth in communities.

One would wonder when we have approximately 2,500 practising GPs in this country why we have 10,000 practising solicitors. This indicates there is much work and money to be made, to be very blunt. Collectively, this Dáil has a responsibility: we can give out but we want solutions. We need to solve this problem collectively as small and medium enterprises all over the country are in trouble. I thank the Minister of State for attending the meeting with the Irish Co-operative Organisation Society, ICOS, and Mr. Brendan Egan from Castlerea mart, as marts are a small or medium business. They are screwed with insurance as well because of constant claims. They need cameras everywhere. If something happens to a person at home, he or she cannot claim but nevertheless a solicitor can advertise with "no win, no fee". This craic must stop and if a person takes a case there should be repercussions if it is exaggerated or lost. Money should be repaid.

We need to look again at the book of quantum and at England's example. We must implement the 15 recommendations as soon as possible. Let us be honest, as there are people here with their own businesses. We will not be able to drive on both sides of the road. We must ensure we can stand up to be counted. When the book of quantum is done, we must ensure it is adhered to. The Judiciary must run in line with this. We cannot have a system with fairy figures being given out. People are panicking. Insurance companies, including one for the farming community, will not even contest a case if it is under €100,000. Those companies let such claims through but this leads to rising insurance. People's hearts are in their mouths waiting for quotes for the cost of insurance.

Right around this Dáil we must work on this together. We can give out to a Minister or the Government but the insurance problem has been escalating in the past four or five years. It is extremely bad. Ultimately, if we lose the small and medium enterprises that employ most of the people around the country, we will have less money coming to the Exchequer and less going out. It is up to us, collectively, to solve this problem and get working on it as fast as possible.

We now move to the Fianna Fáil slot, which is ten minutes. Deputy Danny Healy-Rae can ask other Deputies for some time but his group's time has expired.

I welcome everybody in the Gallery and thank them for being here. It is widely accepted that we have a serious problem here and businesses across the country, including many small and medium enterprises, are being crippled by insurance costs that are going up and up. We know the SME sector employs approximately 44% of all people employed in this country, so we should do all we can to protect those businesses to ensure they can operate in a sustainable fashion. We are very good at reports, talking, more reports and having no action. The question must be when will the Government complete the action points on the report on the cost of employer and public liability. The time for talking is now over. If the Government cannot solve a very obvious and simple problem, what are we doing? We know this matter has been around and highlighted many times over a period. The Government has not yet fixed it and I want to know what it will do about it, as does every person in the Gallery tonight.

It is very easy to blame the lawyers in this. I was a lawyer and I dealt with personal injuries. I was also the victim of what I considered a spurious whiplash claim. My insurance company did not consult with me and it paid out without challenging that claim. It is a major problem that insurance companies are not taking responsibility and paying out claims without challenging them. That must be admitted. It is very easy to blame other professions and pass the buck by saying the problem must be with somebody else. The insurance companies must do their jobs as well. They should challenge claims where they believe there is a real and substantial risk that the claim could be false.

It is very important that we guarantee those here tonight that we will have a business environment in which they can operate and which is sustainable. Insurance forms a massive part of ongoing operating costs and it is affecting our competitiveness and the ability of SMEs to retain the jobs we have and employ new people. I can give an example before I finish. A tree surgeon in my community had a few vans on the road and he employed men. The cost of his insurance almost doubled in one year so he had to let people go. That is happening all across the country.

It is accepted that the cost of insurance for businesses right around the country is crippling them and ultimately costing jobs. It is particularly difficult for the small and medium enterprise sectors because it does not have the huge amount of business to dilute the significant costs of business. The cost of business insurance is now holding small and medium enterprises back, as we hear of quotes doubling and trebling from previous years. It is stopping business owners from investing in marketing and other promotional activity that drives job creation in this sector. The lack of real competition in the market means business owners must accept this cost with no worthwhile or effective means of shopping around.

It is extremely frustrating that the Government believes that since the report on the cost of employer liability and public liability insurance has been published, the job is done. Sadly, nothing could be further from the truth, as many of the recommendations in the report are not set to be completed until 2019. It is a criticism I have of this Government that all its energy seems to be focused on big projects, accompanied by millions of euro of spin. There is a promise of delivery down the road at some utopian point. Whether it is about hospital beds, housing or broadband, we will have much in the future but meanwhile people must suffer in the short to medium term. It is the same with job creation. We will have many jobs in future and we have been promised full employment. We might even see jobs in the regions if we are willing to wait for the roll-out of projects like Project Ireland 2040.

We need jobs now in the regions. I refer to vision of the future that this Government seems hell-bent on selling to the people. Issues such as the management and control of business insurance could have an immediate effect on the provision of jobs in the regions. It might be tedious work and it might not grab the headlines but it is work that would see quick results. It would rapidly ease the financial burden on small employers and encourage them to invest in marketing that will grow their business and provide much-needed jobs. This should be the focus of the Government. I urge the Minister to bring about the necessary changes in business insurance costs to make that happen.

I, too, welcome this motion and support my colleague, Deputy McGrath, in the work he is doing. I refer not only to this area but also to the proposals he has brought forward in relation to motor insurance and in many other areas that affect business people and people generally. The small and medium enterprise sector is an important one in our community and economy. I welcome all of the people here this evening in the Visitors Gallery. The sector employs nearly 1 million people. It provides massive lifeblood for our economy, creates major employment and much activity in local areas as well as nationally. It also provides a valuable service.

However, there is a real problem. The costs for businesses increase continually and they are finding it difficult to access credit now. The banks are chasing those businesses that have performing credit to try to take that back off them. The cost of the increased rates is going out of control and getting more expensive. Business insurance has also gone up and in some cases by 20%. There are no proper reasons given and no proper explanations. I learned only this week that one excuse given by an insurance company was Storm Ophelia. That is the new reason for insurance premiums going out of control.

There is a reality here. I have spoken about it before. Insurance companies are operating in a cartel-type manner. I raised this at the Committee of Public Accounts before and I was cautioned for doing so. However, I am happy to hear so many Deputies raising the same issue and saying the same thing. We need to bring in more competition and open it up to European countries. We need to put manners on the insurance companies because there is no reason and no justification for what they are doing. Action is needed and it is needed urgently. I am calling on the Minister of State to bring action into play and deliver on this and other issues.

Businesses throughout the country are facing crippling costs for insurance. I have dealt with many of them in Gorey, Enniscorthy, Wexford and New Ross. Charities, community groups and sports clubs are also badly affected. Many businesses have experienced substantial and unjustifiable insurance increases recently. With this in mind, I commend my party colleague, Deputy McGrath, on bringing forward this motion calling for urgent action to tackle rising insurance costs. Employer liability insurance, public liability insurance and motor insurance are becoming an unsustainable burden. Despite this, the Government is doing little to tackle this problem.

A good start for the Government to tackle the soaring costs for business insurance would be to create an index of insurance premium increases. The burden on businesses is bounded by the greater use of insurance excess and insurance exclusions. These are increasing the cost of insurance by the back door. Insurance fraud is another reason premiums are high. No data are currently collected or published by the Courts Services on the number of instances of fraudulent and exaggerated claims. In many instances, insurance companies are not challenging claims they believe to be dubious or potentially fraudulent. There is also a real and perceived lack of consistency in the awards handed out for personal injury claims.

These are all issues that could and should be tackled by the Government. If it does not tackle these issues, it will push many of these businesses and organisations out of existence. There are steps the Government could take. It could work towards creating a single European market for insurance to better enable businesses to shop around. It could urgently complete the recommendations in the working group's report on the cost of employer liability and public liability insurance. It could tackle insurance fraud. It is not acceptable that the Government's inaction is affecting all types of insurance costs. We should not forget that our small and medium enterprises employ almost 1 million people. It is about 44% of those employed. I urge the Government to take action.

I thank Deputy McGrath for bringing this motion forward. However, we would not be here if Facebook or any of the big American companies were making this an issue. The Minister of State would dance to their tune immediately. However, this is an issue that is predominantly crucifying small businesses throughout the country. We are here because the Minister of State would not listen to the representations made by small businesses from around the country at the Committee on Finance, Public Expenditure and Reform, and Taoiseach. Our report is being allowed gather dust while businesses across the country are being fleeced by their insurance companies. They are using these small businesses to rebuild their balance sheets and cash reserves that were ruined by bad management decisions.

The Government cannot stand by and look at these kinds of increases - tens of thousands of euro each year - that effect many small businesses. It cannot continue to ignore that happening and the impact that it is having on small business owners and on employment creation. There was a much-derided ambition to make Ireland the best place in the world to do business by 2016. However, for many that did not happen because they were put out of business by not being able to afford insurance and not being able to reinsure. The Minister of State needs to act on the report. Settlements that are made out of court on a nod and wink basis, that businesses are being made to pay for, need to be published. We need to ensure that serial suers who claim against multiple businesses are highlighted, even if their cases are somewhat dubious.

Urgency needs to be injected into dealing with this debate. I refer to the need for an urgency and understanding at Government level, and at permanent Government level, of the kind of increases that businesses are facing. People are either being forced out of business or to carry on their business without insurance. That is illegal in many cases. The Minister's inaction is forcing small businesses into illegal action. They just want to get on with the job of being a business. Is lá na Gaeilge é inniu, agus tá gnóanna beaga faoin bhrú céanna agus atá an teanga in Éirinn freisin. Do not give us the standard Government response. It is unfortunate that there is nobody from the Department of Business, Enterprise and Innovation here. Do something about it.

On a point of order-----

There is no point of order.

Someone took my spot.

I can pre-empt what the Deputy is going to say. The Deputy was too late.

I am appealing to the Minister and the Government. They are in power-----

Deputy Healy-Rae-----

-----and can do something to help these-----

The Deputy knows-----

-----people from around the country and from Cork and Kerry. Their backs are to the wall-----

Will Deputy Healy-Rae retake his seat?

-----and driven down to the ground. I am appealing to the Minister to do something.

Deputy Healy-Rae is taking advantage.

I thank the Leas-Cheann Comhairle.

Do not be thanking me.

(Interruptions).

I ask Members and those in the Visitors Gallery to refrain from applauding. I want to be very clear with Deputy Healy-Rae.

I am very sorry.

(Interruptions).

There is no point in being sorry afterwards. The Deputy was late arriving. The Minister has ten minutes.

I want to dispel one thing that has been consistent from the Opposition, which is that the Government has done nothing on this. People are looking for a roadmap. There is a roadmap. There is the motor insurance report in conjunction with the report of the Personal Injuries Commission, PIC. I have been struck by one thing when meeting people, and since I have come into this job I have met the Irish Hotels Federation, IBEC, ISME, the Vintners Federation of Ireland, the Licensed Vintners Association, RGDATA, Chambers Ireland, the Law Society of Ireland, the Health and Safety Authority, Insurance Ireland, the chief executive officers from the operating companies, representatives from Lloyds and others. Anybody who says this Government is not doing anything does not know what they are talking about. This is the report and there are 15 recommendations and 29 actions. All of the actions for quarter one will be concluded on time. All of the actions for quarter two are on track. We will have 26 of the 29 actions concluded by the end of the year and 12 of the 15 recommendations also by the end of the year. People should not mistake where we are making movements in the right direction with an action. We are dealing with things. We have moved a lot of difficult issues in conjunction with the motor insurance report. Make no mistake about that, please.

I thank Deputy Michael McGrath for the opportunity to speak on this. I am truly disappointed at the number of occasions that I meet people in respect of public liability and employer's liability and the number of people who come to meet me and do not even know about this report. I am always surprised on every occasion. It is important to understand that it is the cumulative effect of all of these actions, with the actions from the motor insurance report and the other reports, when we get them all done, that will have a major impact on the sector.

It is not just one or two silver bullets.

The Minister for Finance is not in a position to direct insurers to provide cover or to provide it at a particular price. He does have a role in setting out a roadmap for reform for the sector as a whole, however. That is what these reports and their recommendations are designed to do. Ultimately, the overarching aim of the working group report is to ensure the insurance sector is stable and consistent, making it a more attractive place for new entrants. If this is achieved, there will be more competition and prices will become more affordable.

This issue of increased competition is important. One point that has become clear from my engagement with business policyholders is the limited selection of insurers available to provide cover to them. In some instances, it is just one company and, quite often, that single company is based outside of the State. As a consequence of this lack of competition, the price of cover being charged is in some cases exorbitant. In turn, the business has no choice but to accept it because no one else is willing to offer any such cover. We must, therefore, make the market more attractive. That is why the working group believes the emphasis needs to be on ensuring consistency in award levels through the regular use of the book of quantum. If this objective can be achieved, then insurers can have greater certainty and predictability in reserving. This type of stability should encourage more companies, both domestic and from outside of the State, back into the market.

An insurance award should be within the book of quantum, whether somebody chooses to conclude it without going to the Personal Injuries Assessment Board or going down the legal route. That is what we must achieve. If we can do that, then we will have removed the outliers in which the insurance companies are obliged under the Solvency II directive to have higher levels of reserve. However, there is no single policy or legislative initiative which can immediately transform existing insurance pricing. Some actions require time to be implemented. For instance, those which require legislation to be put in place, such as a national claims information database, also require reform of existing legislation.

We must challenge the insurance companies not to settle cases early. We have heard the same story from every single sector, be it refuse collection, marts, farms or retail, namely insurance premia go up when a claim is made. The circumstances in that are not acceptable. I met with the Minister for Justice and Equality today on amending section 8 of the Civil Liability and Courts Act 2004. This requires an initial warning letter to be sent to inform a defendant as early as possible about a claim. Currently, that stands at two months. We must reconcile this with new data protection rules under the general data protection regulation, GDPR. These will come into effect in May and will require CCTV evidence must be deleted in a period of time. If a claim is taken against somebody, the defendant must be informed about it to ensure any CCTV evidence is retained. This will allow people to be in a position to prepare a proper defence. Often, claims are made six or eight months after an incident but the video evidence has gone. Accordingly, the business has no method of defending itself appropriately. We must ensure this ends as quickly as possible. I met with the Minister for Justice and Equality today and we are on track to ensure this will be in place in six months to coincide with new data protection rules.

Sections 25 and 26 of the Civil Liability and Courts Act 2004 deal with false evidence and fraudulent actions. Taking a claim against somebody is effectively a one-way bet. One can go to court, take a chance and try to get a big chunk of money from the insurers. However, they are not taking from insurers but from the pockets of everybody who pays insurance premia. This results in every premia being more expensive than it should be. In cases where a judge believes there is fraud or extreme exaggeration, he will make no award. However, this costs the person who made the claim nothing. We need an appropriate pathway between An Garda Síochána, the Director of Public Prosecutions, the Courts Service and insurers to ensure such a claimant does not walk out the door scot free and can chance it again the next time. That is one area in which we can prevent fraud. We have analysed sections 25 and 26 of the Civil Liability and Courts Act 2004 and we believe they are strong enough to provide for this.

Much work has been done in this area but I have not been able to touch on all of it in the time allocated. People are not aware of the amount of work done. I have suggested to the Chairman of the Oireachtas finance committee that my officials and I would present to the committee to outline what we have done and what we intend to do. I intend to end the era of people taking a punt and screwing somebody over through a dodgy claim.

I welcome Deputy Michael McGrath's continued focus on the crippling costs of business and motor insurance. I also welcome the presence of business owners in the Visitors Gallery, as well as representatives from my industry, the hotel sector.

The unsustainable increases in insurance premia have reached a stage where workable businesses with long-standing records in communities are now wondering whether they have a viable future. Regretfully in the hotel sector, public liability claims are now becoming the norm. I have almost 30 years' experience in the business and have witnessed various spikes in insurance costs over that time. What is happening today, however, I have never witnessed before. I had a public liability claim free record for over ten years until a relatively small claim two years ago. As a result of this, I witnessed in this two-year window an increase in insurance costs of over 200%. My costs have moved from a five-figure to a six-figure sum. No business can sustain that level of increase. The double whammy of an insurance system that receives its profits from premia from business owners, along with a legal system which sustains large claims for the smallest of incidents, incentivises this culture of claim and uncontested pay-out.

The other injustice is the burden unfairly carried by the small business sector. Chains of hotels or group hotels, for example, carry a larger influence and weight with the insurance industry while the single operator is at its mercy.

In Ireland we rely on small owner-operators. The Irish small and medium business sector is the foundation of our economic model but the current insurance regime is out of control and will close Irish businesses unless action is taken. That is why we have Governments. That is why we in this House are elected. If there is injustice in the market, we have a duty to fix it. I welcome the determination of Deputy Michael McGrath to focus on solutions in regard to insurance. I urge the Government to act.

I welcome the motion and thank Deputy Michael McGrath, who has been dogged in pursuing escalating insurance costs, whether business or motor insurance, which is an ongoing issue we have been raising. I also acknowledge those in the Visitors Gallery, who are busy people who have taken time out from their own work to be here for the debate tonight. I am sure that after several hours here they are eager to be back in their own businesses, making things happen.

I firmly agree with the motion that rising costs for employers through public liability insurance is a threat to the competitiveness of small businesses. I want to focus on the fact it is also a threat to the communities which these businesses serve. Right around the country we see that small businesses, very often family-owned businesses, are supplying up to 40% of the jobs. We know the National Competitiveness Council has stated the cost of doing business is a major concern for overall competitiveness. Many SMEs have experienced very large increases in business insurance and, in addition, insurance companies are using insurance excess and exclusions to protect themselves at the expense of the businesses. Constant pressure from overheads, including the rising cost of business insurance, is squeezing traders and eroding their income, and it is an influencing factor in regard to them reducing their services or even stopping. The pub may close the dance floor, the pool room or the meeting room, the café may not have a hangout area for teens, and public liability insurance may be too expensive for community groups who would have to stop holding a festival or a local parade. In the interests of these various community groups and businesses, action needs to be taken.

I thank Deputy Michael McGrath for bringing forward the motion on business insurance. I acknowledge the presence of all those in the Visitors Gallery.

The arguments have been made and put in front of the Minister of State. The evidence is overwhelming and what we need now is action. There are 15 action points in the report on the cost of employer and public liability insurance that are due to be completed in the first half of this year. I ask the Minister of State to take action to implement them. We need to oblige insurers legally to provide a breakdown of the premium cost of the business and to provide more information to businesses on how premiums are calculated. We need to ensure the book of quantum is updated at least once every three years. We need to ensure the research on the book of quantum is based on medical evidence and cost, not solely on historical claims. We need to bring in tougher penalties, both financial and otherwise, for insurance fraud and claim exaggeration. We need to oblige insurance companies legally to notify policyholders of claims made against them before settlement, the amount a claim was settled for and the reason the claim was settled. We need to bring forward the deadline for the Department of Finance and the Central Statistics Office to report on the creation of a price index for employer and public liability insurance premiums and establish such an index. These are practical, doable suggestions. The time for talking is over. The time for action is now.

In the short time available to me, I want to refer to this issue in a practical way by giving three examples of situations I have dealt with since I became a Deputy in 2016. By the way, most of the work in my constituency offices in the past two years has been dealing with insurance issues, not alone motor insurance but also business insurance and now flood insurance, which is an area I have had to examine with Deputy Michael McGrath.

I will give the example of a young man who wanted to start a taxi business in Carrick-on-Shannon. The cost of the insurance was €12,000 and, naturally, he had to abandon his plan. Another example is where parents bought a car for their student daughter. The 2004 car cost €3,000 and has passed the NCT perfectly, and what happens? They cannot get it insured, despite it being perfectly fit for the road. The third example is that of a local hotel which was purchased in recent years and for which I have lobbied. The public liability insurance had been €12,500 but in the second year it went up to €21,000 and it has now gone up to a whopping €52,000.

I and everyone here can tell the Minister of State that the time for reports and that type of action is gone. We want real action. Unless that action occurs in the coming months - in other words, a reduction in insurance costs - many businesses like those represented here this evening will close. They are not able to take this hit. This whole area must be dealt with. We all talk about claims and, of course, there are many claims we can question. However, there is something else going on in the insurance industry that needs to be investigated. The Government needs to get to the bottom of this and deal with it. The book of quantum needs to be dealt with. It is extraordinary that some types of injury, or so-called injury, do not need to have medical backup.

My time is limited and I have to hand over to Deputy Michael McGrath. While I do not doubt the sincerity of the Minister of State, we have to act on this.

I thank all of the contributors and again thank all of those who came to the Visitors Gallery to listen to the debate. What they will want to know is what the outcome of this will be, whether it will lead to any change and whether the Government will focus on delivery. That is what this has to be about. It is all very fine to pass a motion in the Dáil but it has to mean something. The Government has to focus on getting some short-term wins in this area.

We are operating in a vacuum because we do not have the information about premium increases affecting the business community, for example. The Minister of State should be taking a sample of businesses to track their insurance over a short period, and I encourage him to do that quickly. I also encourage him immediately to require insurance companies to explain to policyholders what they have done to challenge claims and the work they have done to get to the point where they make a settlement. It is a very practical step which is achievable. Where claims are made that insurance companies believe to be bogus, false, exaggerated or fraudulent, there should be an onus on them to refer those to the Garda immediately for investigation. If the Government takes those short-term steps while working on the longer-term policy issues as well, I believe we will make some real progress. We need the data and we need transparency. Some of the timelines in the action plan are not good enough. With regard to the national claims database, the Minister of State is talking about a report on the feasibility of including business insurance by the end of 2019, which is not good enough. It is the same with the CSO giving us the record of business insurance premiums. That is not good enough and the Government has to bring that forward.

The Minister of State's party's mantra is a republic of opportunity. Those who are here tonight and many of those who are watching want the opportunity to continue in business and to continue to provide employment and services for their customers, and not be put out of business by exorbitant insurance costs. Surely they deserve that. We will certainly back them and I hope the Government will too.

Amendment put.

In accordance with Standing Order 70(2), the division is postponed until the weekly division time on Thursday, 22 March 2018.

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