Rose Conway-Walsh pushes insurers to pass on compensation cuts
Rose Conway-Walsh spoke on 1 Jun 2021 in support of a bill introduced by her colleague and finance spokesperson Piers Doherty that would require insurers to provide data to the central bank so savings from new personal injury guidelines are passed on to policyholders. She argued insurers have long hidden behind the book of quantum and must be forced to pass on reductions rather than retain increased profits.
Bill purpose
The proposed legislation would require insurance providers to submit the relevant data to the central bank so that the savings from the implementation of the personal injury guidelines can be passed on to policyholders. The bill aims to guarantee that reductions in the cost of insurance claims are transferred euro for euro to customers.
Transparency concerns
She said insurance companies have for years hidden behind the book of quantum and used the high cost of personal injury claims as a cover for charging eye-watering premiums. Since 24 April, when the personal injury guidelines took effect, that defence no longer exists, but industry tactics continue to keep raw data hidden from those asking why policyholders pay high premiums.
Investigations and market barriers
The EU Commission conducted unannounced inspections amid concerns about price-fixing and cartel-like behaviours among motor insurance providers. The Competition and Consumer Authority Protection Commission also conducted investigations and found a lack of market data was serving as a barrier to new entrants.
Expected impact and comparisons
She told members the new guidelines reduce the level of personal injury awards between 31% and 69%, and pointed to similar regulations in Britain following reductions in whiplash awards where many of the same insurers operate. Without mandatory data-sharing and firm requirements to pass on savings, she warned any reduction could be only a paper exercise that boosts insurer profits.
Appeal to colleagues and urgency
Conway-Walsh praised Piers Doherty for bringing the bill and urged Oireachtas members from all parties and none to stand for fairness. She argued price gouging of people legally required to buy insurance must be stopped now to protect motorists, businesses and homeowners.
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I want to commend my colleague and finance spokesperson, Piers Doherty, for bringing forward this bill and he has provided an opportunity to all Oireachtas members from all parties and none to demonstrate to those who have been crucified by high insurance costs that they too are prepared to stand for fairness. Insurance companies have for years hidden behind the book of quantum. They have continuously and consistently used the high cost of personal insurance injury claims as a cover for charging eye-watering premiums for compulsory insurance and since the 24th of April with the personal injury guidelines since they took effect they no longer have this defence. Yet we know from experience that every possible tactic is used by the insurance industry to keep the raw data hidden from those who ask why Irish policyholders are forced to pay such extortionate premiums. Indeed we know that the EU Commission was sufficiently concerned about price fixing and cartel-like behaviours of motor insurance providers that they conducted unannounced inspections. The Competition and Consumer Authority Protection Commission also conducted its own investigations and found a lack of data on the market was serving as a barrier to new entrants. Price gouging and the rip-off of people who are legally required to purchase insurance has to be stopped. It is not enough to just stabilise the situation as it is. There must be the situation as it is. There must be a real reversal of the crippling cost of insurance and that is why this bill is so important. Put simply it will require the insurance providers to provide the relevant data to the central bank so that the savings from the implementation of the new guidelines can be passed on to the policyholder. The substantial reduction of insurance costs has to be the end game. Otherwise it is all just a paper exercise to increase the profits of the insurance industry. We will not dancing to the tunes of the insurance industry and tackle the exploitation of those who can least afford to hand over their hard-earned money because they are left with no other option. Reductions in the cost of insurance claims must be passed on and this bill will guarantee the outcome that we need. This legislation will apply pressure on the industry to pass on, euro for euro, all the savings that they make to their customers. We know that the new guidelines reduce the level of personal injury awards between 31% and 69%. Similar regulations as was said came into effect in Britain following a reduction in the level of whiplash injury awards where many of the same insurers are operating here. Motorists, businesses and homeowners need us to make a stand for them. We need to make it now.
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