2026-05-26

138. Deputy Pearse Doherty asked the Tánaiste and Minister for Finance the reason the motor insurance transparency code is voluntary and not subject to administrative sanctions procedure. [39714/26]

The Minister finally published his motor insurance transparency code, which was promised in the so-called insurance action plan. The action is completely powerless with no powers to sanction companies. Worse still, I understand it is voluntary. That was never mentioned in the original action plan. Why is the Government afraid to stand up to the insurance companies and hold them to account?

The motor insurance transparency code was launched as a priority measure under the Government action plan for insurance reform from 2025 to 2029 to enhance transparency, clarity and consumer understanding in the motor insurance market. The code was developed by a working group comprising insurers and intermediaries with the support of the Department of Finance and the Central Bank. The code is designed to complement, rather than duplicate, existing regulatory requirements. It sits under the legislative umbrella of the Central Bank of Ireland's consumer protection code, CPC, and aligns with relevant disclosure requirements and requirements to inform customers effectively. The revised CPC came into effect on 24 March this year and is legally binding on insurance companies and intermediaries. The Central Bank's administrative sanctions procedure will be applicable in respect of non-compliance with the revised CPC. The voluntary nature of the code allows for an appropriate balance between transparency and the protection of commercially sensitive information. The code has been carefully designed to provide meaningful insight to consumers into how premiums are calculated, while ensuring that firms are not required to disclose information that could undermine competition or market functioning. While the code is not subject to the administrative sanctions procedure, there remains a clear framework for oversight and monitoring. The Central Bank will provide a report to the Minister for Finance in advance of the first review of the code, which will take place within 18 months of implementation. This report will be on the Central Bank's observations on firms' adherence to the code and the effect the code is having in achieving its objectives. If it fails to achieve the objectives, we are, of course, open to putting it on a legislative footing.

The cost of car insurance is going up and up. This is the fourth consecutive year of price rises and every motorist knows it. Irish people already pay almost double what the European motorist pays for car insurance. When one adds soaring fuel costs, too many people are being pushed to the brink in trying to keep a car on the road. We know from the Central Bank that the cost of car insurance is going up while costs for insurance companies are going down. The simple fact is that companies are pocketing the difference with the tacit support of Government. The answer of the Government is a voluntary code designed by the insurance industry. It is difficult to overstate how weak an approach this is. How is the public supposed to have any faith this will work when it is optional and completely toothless? We need a Government that is standing up to insurance companies and ensuring that the benefits of the reforms that have been passed in this House over the past number of years are not going into the pockets of the companies but, rather, are passed on to consumers in the form of reduced premiums.

As the Deputy will be aware, we are implementing the second action plan on insurance reform. Reforms are working. The latest CSO data of April 2026 shows that in the year to date insurance premiums are 2.2% lower this year than in April 2025. The Deputy may want to dispute that figure. Premiums are still 35.8% lower than they were at the peak of 2016. I acknowledge that we need to keep a close focus on this to ensure we continue to see a downward move. This transparency code will help to achieve that. Some 2.2 million policyholders will see the benefit of this code in their quotations and renewal documents from quarter 3 of this year. Despite the fact that it is a voluntary code, 97.5% of insurers and intermediaries selling insurance in this State have already signed up to it. This will enable consumers to see exactly how their policy is charged and to shop around to ensure they get the best value for money in their policy.

Does the Minister of State not accept the average cost for motor insurance in this State is now €655? Does he accept that insurance companies are paying out less than half of that in claims? Does he accept that insurance companies are taking more in profits and inflated costs that they are paying out? They are all facts. Insurance companies are squeezing people dry to appease their shareholders. The Government wants to blame drivers. This Government is going along with that. The transparency code refers to risk mitigation and driver behaviour more than profit or inflated costs. I tabled proposed legislation four years ago in the House to set out how a Government could mandate insurance companies to show how they are actually passing on the benefits of these reforms to customers and not profiteering from those same reforms. Instead, we get a voluntary code with no audits or enforcement. Fianna Fáil and Fine Gael and the Independents that support them are blocking my Bill. The public deserves to have full transparency. They deserve not just transparency and accountability, but also reduced premiums, as was promised by these reforms. Unfortunately, if we do not have a Government that stands up to the industry, the industry will of course deepen its pockets with profits.

Insurance premiums have fallen in the past couple of months, according to the CSO.

Not according to the Central Bank.

That is a welcome development. There were a couple of years where there were increases. We are still 35% lower than we were at the peak. That is a success. The reason we re-established the action plan on insurance reform was that we acknowledged there was more work to be done. We are doing that. The transparency code has been published in a timely and efficient manner. Consumers will see the benefit of that code in their renewals come quarter 3 of this year. The last time the Deputy raised the question with me regarding his insurance premium he spoke about how it has increased, but when he shopped around he got a lower one. The simple fact of the matter is that not enough people are shopping around. We now have ten insurance companies providing insurance cover in the motor insurance sector in Ireland. There have been three new players in the past number of years. That is success. There is more competition in the market. Only one in four people shops around and of those, 76% achieve savings. This will enable people to get better premiums on their insurance policies. We will keep the matter under review. It is a success. The Deputy can never acknowledge any progress.