The country's competition watchdog is to launch a market study into the public liability insurance market following growing concerns over pricing levels.
Minister for Business Heather Humphreys requested the Competition and Consumer Protection Commission (CCPC) to undertake a review into the market.
The study will examine how the market operates, how competition works and whether any practice or method of competition affects the pricing levels of public liability insurance.
High premiums have forced a number of businesses, festivals and sports events to close.
Research carried out earlier this year showed that liability policyholders experienced an average increase of 204% in their premiums over the last five years.
Alliance for Insurance Reform, who published the research, said that soaring costs have made business “more unviable” and threatens organisations in the Irish voluntary and community sectors.
Speaking on Thursday, Ms Humphreys said: “The purpose of conducting this study is to bring greater transparency to the market by shining a light on the practices of insurance firms and intermediaries including brokers.
“The issue of insurance for businesses, and its impact on their ability to operate, is a growing concern.
“In particular, the issue of increases in public liability premia for businesses is being raised with me as minister as posing a potential systemic threat to the very existence of many businesses.”
She also addressed concerns about the roles of insurance firms and intermediaries, including brokers, in what appear to be very sharply increasing levels of public liability insurance premiums.
The minister added: “The study forms part of the government-wide response to tackling the cost of insurance. There is no silver-bullet solution to this issue but we are committed to ensuring that we are using every lever available to us to ease the pressure on businesses and consumers.”
The minster said she has asked the CCPC to complete the study as a matter of priority.
The Alliance for Insurance Reform welcomed the news.
Peter Boland, director of the Alliance, said: “Our members have struggled to understand how their liability premiums have rocketed in the last five years while there has been no corresponding increase in either claims or awards.
“We would welcome any additional transparency that might give an insight into why this happened.
“Further we urge the government to move much quicker to publish other long-promised transparency measures on liability insurance like the National Claims Information Database and the Key Information Report on Employer and Public Liability Insurance Claims due at the end of last year.
“Equally, we would urge the CCPC, if they are progressing this investigation, to include employer liability and well as public liability.”
Eoin McCambridge, managing director of McCambridges of Galway and director of the Alliance, said: “While we welcome this news, we urge government and all other interested parties not to get distracted from more immediate reforms.
“Hard-pressed SMEs and voluntary organisations cannot wait for the years it will take for this investigation to be completed and have an impact.
“Ireland stands virtually unique in the scale of general damages we hand out for minor injuries.
“This has had a long-term negative impact on our insurance market and reform of the book of quantum by the promised Judicial Council must happen as a matter of urgency.
“We urge (Justice) Minister (Charlie) Flanagan to establish the Judicial Council immediately and not allow vested commercial interests to deflect from the progress or work of the council.”
- Press Association