- ISME is delighted to see the intervention by Minister Heather Humphreys to provide extra resources to the CCPC
- An ISME member is one of the victims of a significant overcharging scandal
- The Government has gone to considerable length, at taxpayers’ expense, to analyse the underlying issues behind high insurance costs in Ireland
- ISME ask the Minister to ensure that the CCPC’s investigation includes commercial motor, public and employer liability insurance
- Meanwhile, underwriters continue to withdraw from the Irish market
ISME is delighted to see the intervention by Minister Heather Humphreys to provide extra resources to the Competition and Consumer Protection Commission (CCPC) to initiate an investigation into anti-competitive practices in the insurance industry. Small and medium enterprises are the greatest victims of what appear to be collusive practices between a minority of underwriters and brokers. Indeed an ISME member is one of the victims of a significant overcharging scandal reported last year, which is currently being probed by the Garda National Economic Crime Bureau and the Central Bank.
The EU’s Competition Commissioner has also launched an anti-trust investigation into Insurance Ireland, specifically into access to its ‘Insurance Link’ data pooling system. This investigation, however, does not encompass investigation of commercial motor, public liability or employer liability insurances.
We must voice our concern at the reporting of this story on the same day as Minister Flanagan is reported as ‘(going) to war with leading insurers.’ The Government has gone to considerable length, at taxpayers’ expense, to analyse the underlying issues behind high insurance costs in Ireland.
This work over the last thee years has produced the Report on the Cost of Motor Insurance; the Report on the Cost of Employer and Public Liability Insurance;the Motor Insurance Key Information Report; the first and second reports by Mr Justice Kearns’ Personal Injuries Commission, and numerous quarterly update reports. Yet the Government now appears to give the impression that there is only one reason for high insurance costs in Ireland. Mr Justice Kearns has already made it explicitly clear that this is not the case.
The Government’s own reports produced voluminous recommendations, of which the meaningful ones appear to have been ignored,abandoned, or long-fingered:
- The Judicial Council has yet to be set up. Once it is set up, the timeline to producing revised quantum for general damages is up to two years.
- The Senate Bill to cap general damages has been referred to the Law Reform Commission, which will take two or three years to tell us what we already know: there is no constitutional impediment to capping damages.
- The claim-by-claim database, which would give transparency to all underwriters competing in the marketplace, has been abandoned for reasons that do not stack up.
Focusing on insurers alone will not reduce the cost of insurance here. Underwriters continue to withdraw from the Irish market, suggesting Ireland is not the Klondike for insurers Minister Flanagan thinks it is. As we have previously advised the Minister, reducing insurance costs in Ireland will require:
- Reduced quantum for minor injuries.
- Tackling exaggerated and fraudulent claims.
- Reform of the duty of care under the Occupiers’ Liability Act 1995.
- Reform of the rules of court to ensure equality in arms for defendants, and that costs follow the event. 5.Reduction in legal costs.
- Comprehensive reform of the Defamation Act.
- Successful enactment, and vigorous enforcement, of a Perjury Act.
We ask the Minister to ensure that the CCPC’s investigation includes commercial motor, public and employer liability insurance. Similarly, we ask the Minister to endorse our request to DG COMP in Brussels to expand their anti-trust investigation beyond private motor insurance.
- ISME should be referred to as the Irish SME Association
For further information, please contact ISME offices T: 01 6622755 E: [email protected]