Sunday 17 February 2019

Government plans for insurance reform are in disarray

Defence: Junior Finance Minister Michael D’Arcy has backed the working group’s efforts. Photo: Tom Burke
Defence: Junior Finance Minister Michael D’Arcy has backed the working group’s efforts. Photo: Tom Burke
Charlie Weston

Charlie Weston

Much-needed plans to tackle insurance fraud have stalled severely, with the Government failing to provide crucial protection for consumers.

A new database of fraudulent insurance claims in a bid to tackle the high cost of cover has been delayed.

The database of fraudulent claims is an attempt to crack down on exaggerated and false claims.

There has also been a setback in moves to force insurers to tell policyholders a claim has been made on their policy.

The Government has also been forced to admit its intention to set up a dedicated Garda fraud unit is behind schedule, as are plans for a database of uninsured drivers.

This is seen as key to easing the pressure on premiums, which have been shooting up for drivers and businesses.

A new update from the Government's Cost of Insurance Working Group was described as lacking real action by the Alliance for Insurance Reform, a pressure group of businesses and charities.

Junior Minister in the Department of Finance Michael D'Arcy is responsible for insurance reform.

The sixth update of the working group also outlines how the deadline for producing a new national claims information database has been missed. So too has the date for extending the time policyholders are given when their policy is due to be renewed, from 15 working days to 20.

The setting up of a new Garda insurance fraud unit is seen as a key step to tackle spurious and dishonest claims, something insurers blame for high premiums.

The new fraud unit will be funded by insurers but will operate independently.

It is being modelled on a similar fraud-busting unit in the UK. But the Cost of Insurance Working Group report says: "There are a number of serious issues which will require further consideration before any decision whether or not to proceed in this manner is taken."

And the establishment of a National Insurance Industry Fraud Database has been delayed due to data protection concerns.

A delay is also admitted in forcing insurers to give motorists a breakdown of their insurance premium.

The move for insurers to give detailed breakdown of premiums and reasons for any increases is a recommendation of a Government plan to reform the insurance sector.

But the Cost of Insurance Working Group says the Central Bank needs to carry out more consultation on this.

An uninsured drivers' database for use by An Garda Síochána is well advanced, according to the update. But a go-live date is not mentioned.

Director of the Alliance for Insurance Reform Eoin McCambridge said it was clear that efforts had been skewed towards process, not action.

"Right now is the time for real action because the insurance crisis is affecting Irish charities, sports clubs, festivals, voluntary groups, playgrounds, local authorities and businesses."

He said damage would be done to the fabric of Irish society if the pace of real reform did not pick up this autumn.

Mr McCambridge said there were only 29 of what he called "real actions" in the report. The rest relate to a series of meetings and reviews.

Mr D'Arcy defended the efforts the working group.

He said it was important to look beyond delays and to consider the groundwork being done to create a more transparent and fairer insurance environment.

Irish Independent

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