AD HOC COMMITTEE
OFFICIAL REPORT
(Hansard)
Draft Criminal Damage (Compensation) (Amendment) Order (Northern Ireland) 2008
7 October 2008
Members present for all or part of the proceedings:
Mr Peter Weir (Chairperson)
Mr Alban Maginness (Deputy Chairperson)
Mr Alan Bresland
Mr Danny Kennedy
Mr Jimmy Spratt
Mr Declan O’Loan
Mr Alex Maskey
Witnesses:
Mr Stephen Boyles ) Oval James Insurance Brokers
Mr Stephen James ) Association of British Insurers
The Chairperson (Mr Weir):
Stephen James is from the insurance broker Oval James and a board member of the faculty of insurance brokers, and Stephen Boyles is a business manager with the commercial division of Zurich Commercial and the Northern Ireland chairman of the Association of British Insurers.
I welcome you both to the Committee. By way of background, this is the third evidence session. Officials from the Northern Ireland Office attended the first session, and the Committee heard from representatives of the Loyal Orders last week. Members, therefore, know a reasonable amount about the background to, and purpose of, the draft legislation. After your short oral presentation, I will open the Floor to members’ questions. Gentlemen, please give the Committee your views on the draft Order and its implications for future insurance premiums for the affected halls.
Mr Stephen James ( Oval James Insurance Brokers ):
I hope that members have seen a copy of ‘The Story So Far – September 2008’, which is a document that I update approximately every two years. It describes the background to the severe difficulties that specifically affected Orange Halls in the 1990s and that were possibly connected to the political situation at the time. Until 1991, every practising insurance broker in Northern Ireland probably insured Orange Halls, Hibernian halls, Masonic halls or whatever, and no one specialised. However, in September 2001, a major problem in New York had an unexpected effect on the insuring of Orange Halls or community halls.
At that time, several insurance companies — including Prudential and Guardian Royal Exchange, which was subsequently taken over by AXA Insurance — decided to withdraw from the general insurance market. Furthermore, the Edinburgh-based company Tribune Risk and Insurance Services, which provided protection for Masonic halls in Scotland, introduced a policy for Masonic halls and Orange Halls at premiums at half of the previous year’s price. However, given that insurance premiums for commercial risks, home insurance and car insurance were rocketing — and indeed, in many cases, doubling or trebling — that seemed to conflict with the rest of the market. Many small halls did not have sufficient income to pay high premiums to the normal insurance market. As a result, a large number switched to Tribune, which was, within one year, discovered to be a man of straw. The individual who fronted the company is spending seven years in Edinburgh Prison.
However, that broke long-standing relationships between halls and insurance companies. Suddenly, premiums increased, and the insurance market considered that Orange Halls — because of malicious fire-damage attacks — were not a commercially viable risk. Companies were losing money on such policies, and they had to deal with most of the claims. Unfortunately, there was a lack of evidence of involvement of three or more people, which prevented clearance of claims in the Northern Ireland Office. Moreover, Chief Constable’s certificates were not being issued. Therefore, from the insurers’ point of view — which Stephen Boyles can, perhaps, confirm — if a hall broke a relationship, the company would not reinsure in the future. The Grant Scott debacle left approximately 200 to 250 halls without insurance cover. Furthermore, the Prudential and the Guardian Royal Exchange ceased to do business. Halls that had not done anything wrong and that wanted to renew their polices were not offered renewal by the insurers. Therefore, all insurers took the decision not to reconnect.
In January 2003, we — as an insurance broker — were tasked with bringing the halls together. That had not happened before, and, at one stage, it became something of a nightmare. However, we collected as much information as possible from various sources. We approached the insurance market, but companies were reluctant to assist halls that had severed relationships in the past or with whom they had never had a relationship. However, after due representation to all local insurers, the Eagle Star — part of the Zurich group — the Royal and Sun Alliance and the Norwich Union agreed to combine to provide cover that would enable halls to remain open. Some people think that the rates were penal, but they agreed to do it.
We reached an agreement, under which we could not provide cover for a hall that had suffered a malicious attack in the previous 10 years. During the discussions, it seemed that if a hall had suffered a malicious attack in the past 30 years, we would be unable to secure cover. However, we continued to work, and the three company managers combined to produce a facility that provided some cover. However, premiums were relatively expensive. At that stage, the minimum premium was £1,050 plus insurance premium tax, even for the smallest of halls.
Several halls immediately wished to join the facility. We had a common renewal date of 1 May, as we wanted to have some means by which we could consider all community halls together. A lot of Orange Halls, a couple of Hibernian halls and a couple of halls belonging to the Masonic Order were insured by the facility. For the first couple of years, there was no change to the rates because it was too early. Insurance rates are determined by broader and longer-term factors.
In 2006, we got the rates reduced by around 10%. At that stage, 200 halls were part of the facility. In 2007, we had the rates reduced on the property insurance again by 10%. We had hoped that, if the conditions had continued as they had in the previous few years, the rates would further reduce in 2008.
Unfortunately, in 2007, the position totally reversed after a large number of well-publicised attacks against halls took place. I am sure that the gentlemen who are here to represent the NIO will be able to give details of the number of attacks. In February 2008, we hit a difficulty when it came to considering the renewal of the policy. The insurers, quite rightly, wanted to examine the rating with a view to increasing the rates, as opposed to reducing them. However, they agreed to maintain the rates that we had had for 2007-08 after a difficult renewal discussion.
We currently insure approximately 300 community halls with a common renewal date. The cover is not totally basic, but it covers fire and perils — fire, aircraft, explosion, tempest, storm, flood, burst water pipes and impact — and public liability. Generally, that is the cover that a community hall requires. There are no extra special policy wordings. We are attempting to deal with the situation of uninsured halls having to close. We have managed to open quite a few halls, but at least another 100 halls have no insurance cover. Perhaps that presents a difficulty to the trustees of those halls, but, in many cases, they cannot afford to insure.
Our minimum terms on a hall had been £1,100. That was reduced to £1,000, and it is currently about £900, with tax bringing the figure up to approximately £945. If a similar hall were situated in Wales, the north of England or Scotland, one would expect that the insurance premium would be considerably less than what is being charged. That is because of the claims experience of the Northern Ireland insurance market over the past 20 years.
Some types of insurance — for example, public liability — attract higher rates in Northern Ireland than they do across the water. Court awards are higher in Northern Ireland, so one would expect that a public liability premium that cost £150 in Scotland would cost £250 in Northern Ireland. The possibility of a malicious fire attack has governed the difficulties in obtaining property insurance over the past 10 years.
I am sure that I have omitted some bits and pieces.
The Chairperson:
I am sure that members will pick up on any outstanding issues.
Mr James:
That is why I also gave a written presentation.
Mr Stephen Boyles (Association of British Insurers):
No; that is a comprehensive view of the situation. Mr James referred to what had happened with regard to rating reductions for a couple of renewals. Part of that related to the stability that had been brought into the facility which had been put in place. That facility took account of risks that were perceived as being better risks — those that had not been subjected to previous attacks. There was a comfort in that. Underwriters look for the comfort that the risks that they have are as they want them to be. Anything that we can do to remove any element of discrepancy or doubt provides that comfort.
There are other issues such as malicious fires, and one of the halls flooded recently. There is always an element of the unforeseen about any insurance arrangements. However, the issue of the uncertainty about the malicious aspect has driven our problems.
Mr James:
If there were 300 halls, there would be different claims experiences with those halls, whether there was a change in legislation or not. Electrical fires, tripping claims, and a slate falling off a roof on to a car parked nearby can all be described as normal insurance risks. The problem with community halls, and particularly Orange Halls over the past 12 to 15 months, is the possibility that three halls within a mile and a half of each other could be attacked during one night, which would not be a normal insurance risk. We are trying to bring community halls back under normal insurance risks so that they can be rated properly by the insurance company.
The Chairperson:
Thank you. I will take questions from round the table.
Mr O’Loan:
Thank you for your paper and presentation. Is it the case that the sector leaving the Northern Ireland insurance industry after what happened in the market in 2001 had a major effect on outcomes because of the break in relationships? One could now look at that as a short-sighted approach taken by the sector in what seemed to be for their best interests but what turned out to be a short-term interest — if at all. Had that break with the insurance industry here not happened, would the difficulties of getting insurance, and the level of insurance premiums, have been so extensive?
Mr James:
That is a difficult question to answer. During 2001, and coming into 2002, the insurance market took a dramatic swing. Premiums were rising dramatically. Several halls would not have been able to afford the insurance premiums on the go at the time. The best opportunity that a hall had was if it were in a continuing relationship with an insurer, where there may have been a 15% to 20% increase. Insurance companies generally tend to treat long-term customers much better.
The situation did not apply only to Orange Halls. Guardian Royal Exchange and Prudential were ceasing to do any commercial business whatsoever in Northern Ireland, and closing down their departments. The situation was not targeted at the halls that they insured at the time; the insurance companies took a wider shotgun approach to close businesses. However, the timing was dreadful. The Grant Scott situation then came into play and it was completely illogical against what was happening in the insurance market. As the result of a short-term attitude, several halls decided that they could not afford insurance premiums unless they went down that route.
As a practising insurance broker, we were aware for about a year that that was on the go. However, nobody went running to find out whether they could handle the facility in Northern Ireland. Something was wrong, but how could people be told? The Financial Services Agency investigates a matter only when a business closes, and we see the guy going to gaol. That is when the situation really comes through.
He created a situation in which, all of a sudden, 250 halls were seeking to reconnect to the insurance market. However, the insurance market did not want to reconnect with them, because — as Stephen can confirm from the point of view of the Association of British Insurers (ABI) — they were losing money. Insurance companies are commercial animals, which are intent on insuring and trying to make money, but none of them was making money on Orange Halls. Therefore it was done as a facility; they felt a duty to those who had remained with them, but it was end of story for those who had left.
Mr O’Loan:
What is your view on the reasonableness or appropriateness of the three-or-more person rule regarding criminal damage compensation? It appears to be a significant barrier against what one might see as a reasonable duty of the public purse to protect people against the effects of criminal compensation.
Are policies written in such a way that the insurance industry picks up the liability for criminal damage compensation if the public purse does not?
Mr James:
I will take those questions in reverse. All our policies for halls ensure that the property is covered for malicious fire. If there is a fire attack on one of our 300 halls, the insurance company will cover it — until such times as we investigate it to see whether it was a malicious fire that will fall within the terms of the legislation. The insurance company is notified as soon as possible after an attack. I am not sure how many attacks have taken place; you will know better than me. In the event of such attacks, it is a claim against the insurance industry. Subsequently, it is up to the insurance industry to ensure that the claim is put through the solicitor to the NIO, and the NIO — following the police investigation — has to decide whether to issue a certificate.
That is what caused the panic in 2007. A lot of claims were being made, and the PSNI had to be given time to investigate and come back to the insurance companies. One of the important elements in discussions that took place over the past two or three years was the effort to get the police to decide whether they were going to issue a certificate. In a meeting, Paul Goggins said that the police and the NIO had agreed that we would have a decision within three months of an attack, because an attack is an insurance claim until it passes on to the NIO. Even if there are 50 claims outstanding in which it has not been decided whether to issue a certificate, the claimant is guilty until proven innocent.
It is important that we receive a swift response from the police. If the NIO does not pick up the liability for criminal compensation, the insurance industry does, and we will have to deal with those claims. The problem arises when that has to be reflected in the rating of the product.
Mr O’Loan:
You have put emphasis on Orange Halls. What is your experience of insuring many other community buildings, which have experienced malicious attacks?
Mr James:
I represent Oval James insurance brokers — who, until 1 April, was Bartholomew & James Ltd, which was in business for 51 years. We insure 1,000 churches in Northern Ireland, and that encompasses the church, church hall, manse, etc. Over the past five to seven years, the amount of damage that has been caused by malicious attacks has decreased. During the 1990s, there were more attacks against community-based property, but that is from a church perspective.
Over the last five years, our problem has been water damage, as opposed to malicious attacks. It may be that people have been more proactive recently: instead of making claims, they are trying to avoid having to claim. They seem to be much more security conscious; there are many more alarms installed now. Over the last five to seven years, the experience of our church business and the group as a whole, the overall trend has been downwards.
Mr A Maskey:
I will summarise the position, and try to simplify it. In the early 2000s, the insurance sector took a hammering and the price of cover began to rise. Many of the halls were fell when they were suckered by this fly-by-night company. Meanwhile, they had to get reinsured; and the previous company, which had transmogrified into something else, was not keen to reinsure. The combination of that, together with rising costs made things difficult.
You are now in a situation where a number of halls find it difficult to finance the cost of cover. You and others have stepped in to act as brokers, and you have had success in getting a number of halls insured once more. There is the potential that that will produce economies of scale and, and you look to a group insurance solution.
There is a separate problem, in that halls cannot get the necessary insurance because certificates, which would have been issued almost automatically, are not now issued. If I understand you correctly, enactment of the proposed legislation would create a level playing field for the halls that need insurance.
Mr James:
I do not know that new companies will compete purely to get the business on offer from Orange Halls or community halls, or that those companies which have withdrawn from the market will return. However, those which have provided the cover will be more relaxed if the legislation is passed, so long as, when a claim is made quickly, the NIO deals with it and the claim does not sit on a claims experience form. They would be more prepared to increase their exposure in the halls sector, and might allow numbers to increase from 300, to 400 or 500. Also, as Alex says, we have economies of scale. That would work. We expect that, if the proposed legislation is enacted, insurance rates would begin to reduce.
Stephen Boyles represents the Association of British Insurers. We spoke about this just now. It may be that we are emerging from a period of soft insurance market, where there is a lot of competition and in Northern Ireland, things have been kept in check as a result —
[Inaudible due to mobile phone interference.]
However, in view of the “credit crunch” — a famous phrase — and the increase in the cost of capital, the reinsurance and insurance markets will be affected. Rates may increase next year across the board. However, if the legislation were changed to take out of the scenario claims for politically motivated attacks from either side of the community on community halls, then insurance rates for them will reduce. At a time when the cost of other insurances is rising, I that expect those will fall.
Mr Boyles:
The proposed legislation will open opportunities for halls that have not previously been insured because they may have been subject to attack. The comfort that that is being compensated elsewhere will level the playing field for everyone.
Mr James:
Some risks have not been insurable, other than for public liability: one cannot get property insurance cover for them. However, this will allow them to come back into the ordinary insurance market and they will then be insurable.
Mr Kennedy:
Gentlemen, thank you very much indeed for your presentation, and I apologise for my late arrival. I have looked at your written presentation; it is very good, and I thank you for providing it in such a comprehensive way — no pun intended.
Has there been the same percentage increase in premiums for church halls as there has been for community halls/Orange Halls?
Mr James:
No, there has not been. Over the years, the rates for churches have held — in fact, they probably have reduced over the last couple of years. The rates are affected by the general market and what is happening there. Certainly, if we compare a church hall in Northern Ireland with a community hall next door, we would probably find that the community hall is paying twice the premium that the church hall is paying.
Mr Kennedy:
I want to find out about the insurance market and its cycles. Last week, we heard evidence from representatives of the Grand Orange Lodge of Ireland, and their view was that insurance cycles largely last for periods of up to five years. The draft order contains a sunset clause that will either be renewed or will cease to have effect after three years???. Would three years be a sufficient period for the insurance market to have comfort in the situation?
Mr James:
I will go back to what I said in the written submission. When the major problem arose in 2001-02, as far as the insurance market was concerned, it was looking back over a period of 12 to 15 years because that is when the attacks on Orange Halls and the difficulties began. When we first started to insure community halls — when the three major insurers came together — we could not, at that stage, insure any hall that had suffered a malicious attack for 10 years. As I said, at one stage, it seemed that any hall that had suffered a malicious attack in the past 30 years would not have qualified for insurance cover. We were trying to launch an initiative at a very difficult time, when everything was going against us. However, we kept plugging away, and we eventually got there.
In my experience, a normal insurance policy will have a five-year claims experience attached to it. However, with community halls/Orange Halls, a much longer period of a hall’s history has to be considered. The difficulties really began in the late 1980s and early 1990s, some be 15 or more years ago. We want to find a way to give insurance companies confidence that a risk that is not really an insurance risk — it is perhaps more politically sensitive — is really not a matter for insurance companies when it comes to considering whether to insure a community hall. We want to try to introduce a measure that removes that risk from the insurance market and allows Government to deal with the matter. The effect of the discussions that have been held on the proposed legislation has been that, in the past eight to nine months, the number of attacks has gone down. Across the board politically, everyone has said that the situation is stupid and ridiculous. The legislation would give confidence to insurers, but it would also make people realise that there is no point in attacking community halls because the cost of repairs will be borne by the public purse — that is what will happen with malicious fire attacks.
That is why I was surprised when I read the sunset clause. The three-year limit is ridiculous. It is more to do with the overall situation in Northern Ireland. We hope that things will continue to improve, and that the law will come into effect somewhere down the line. I am against having any sunset clause in the legislation, but that will not be for me to decide.
Mr Spratt:
Some of the points that I wanted to raise have already been answered. However, let us go back to the question of Chief Constable’s certificates and the “three or more persons” scenario. It seems that it was easier to obtain a certificate prior to 1994, but became more difficult after that. Do you have any views on the reasons for that? You talked about an insurance logjam. Given that there have been several attacks in the past few months, has that logjam been cleared, or is the Police Service still dealing with those issues?
Mr James:
I will go back to two different aspects. Until the late 1980s and early 1990s, there had not been a large number of attacks on halls at any particular time. A hall may have been attacked here and there, but there were not a great many attacks. The political situation changed in the 1990s. Quite a few halls were attacked, but there are sensitive reasons why those attacks took place. It got the stage that, by 1994, 24 or 25 Chief Constable’s certificates were sitting in a pile, and no decisions had been taken on them, even though the attacks had occurred one or two years previously. The loss adjusters who acted on behalf of the Association of British Insurers (ABI) said that those incidents should clearly have been covered by a certificate. When the ABI met the Government of the time, the insurers made it clear that renewals would not be granted to Orange Halls — because the attacks had been concentrated on those halls — until the situation was dealt with. Within two months all the certificates were cleared.
Mr Spratt:
So the logjam was totally cleared?
Mr James:
That was in 1994. We became involved with the NIO in providing information on attacks, and have had a fair bit of contact with them over the past six or seven years. There were not many attacks between 2002 and 2006, so it was easy to keep on top of the situation. 2007 was different, because quite a number of attacks took place within a short period of time. The difference was that we were able to push those members of the Government, the criminal justice service and the NIO, whom we were in contact with, for an answer.
For the first time, I attended two or three meetings with Peter Hain and Paul Goggins, and was able to emphasise that it was important to get a response. If they were going to issue a certificate, then they should issue it, but for goodness’ sake, they should tell us if they were not going to do so. Otherwise, it is one against us. We pushed things that way, and we were given confirmation by the Government and the NIO that they would make a decision on a certificate within three months of an event occurring. As far as I am aware, that commitment is being kept. I cannot put my hand on it, but a lot of decisions were made fairly quickly in 2007.
Mr Bresland:
My question is similar to Jimmy Spratt’s. Did Strabane Orange Hall get a certificate?
Mr James:
Not that I am aware of — up to the present. A lot of halls were attacked in north Armagh. Two or three halls were attacked in one night, but we might have insured only one hall. Some of those halls may have been uninsured or insured elsewhere; we did not cover many of them. Those halls were able to be connected together in some shape or form, and I think that those halls — as a bulk — received a certificate. As far as I am aware, Strabane Orange Hall has not got a certificate and is not getting a certificate. We did not insure that hall, and that is why I cannot say categorically. However, I understand that it is not getting a certificate.
There were several other attacks. We were not insuring the properties in Castlederg, although a hall in Castlederg, which was a total loss, did get a certificate.
Mr Bresland:
They got a certificate?
Mr James:
Yes. Again, a couple more halls were attacked in the Castlederg area, and I understand that they got certificates. However, Strabane Orange Hall was the biggest hall attacked in 2007 and, as far as I am aware, it did not get a certificate. It was a total loss.
Mr A Maginness:
Why should you not carry the risk? You are an insurer, and the whole purpose of insurance is to cover risk. When one looks at the figures provided by the Orange Order it can be seen that the pattern and incidences of attacks vary right across Northern Ireland. You benefit and profit from the premiums in good times and suddenly, when a situation happens, you say that you will not cover that risk.
Mr Boyles:
The political situation in Northern Ireland had driven the issue over the past 40 years, and that is where it was seen to be different. Property insurance policies in Northern Ireland exclude any terrorist-related activity, which is picked up by Government indemnity. Similarly, terrorism is excluded in GB, but one can purchase insurance from the Government through an insurance company called Pool Re. However, Northern Ireland is slightly different because of what drove the situation. In simple terms, property insurance is not a compulsory class of business. There is an obligation on insurance companies to provide employers’ liability cover, but they have no obligation to provide property insurance. Therefore, there is no compulsion on anyone to take on an unattractive risk.
Mr James:
The malicious fire risk is covered by the insurance market, but it must rate for that. There have been many attacks on community halls over the past 40 years. However, in the first 20 years there were not as many attacks as there have been recently. That is not because different materials are being used for building halls, or that electrical heaters have caused fires, or this, that, or the other: it is because those attacks have been motivated, not by something that the insurance market can take care of, but by attacks coming from a different source as a result of the political situation in Northern Ireland having moved on.
I cannot believe that just talking about the legislation has already had a dramatic effect. The number of attacks has reduced considerably. People are wakening up and asking why community halls are being attacked, if there is something there to back it up. It is not an insurance company, but the Government is there with us.
Mr A Maginness:
You referred to the sunset clause. I am not so sure that it is a sunset clause in the strict sense because it is subject to renewal if circumstances show that there is a pattern of those attacks repeating. The Secretary of State can renew the order.
Does that not give you any comfort?
Mr Boyles:
Insurance underwriters always look for a trend, and three years is not long enough for one to be established. The situation this year and for the next three years may be calm, but that is not long enough to give anyone in the underwriting world any confidence. One issue with having a sunset clause of three years is that it could result in another Grant Scott/Tribune situation in which an insurer decides to come in to take the business for the three years for which it is ring-fenced. Should the legislation not be subsequently renewed, that insurer may decide that the comfort of underwriting that business had gone and let the traditional insurers who previously had the business take it back.
Mr A Maginness:
I understand your point, but it is not an absolute sunset clause. A guillotine will not come down after three years. Surely that means that insures would have a six-year period, which is reasonably conterminous with the five-year period that you mentioned.
Mr Boyles:
It still does not remove the uncertainty of what happens after that.
Mr A Maginness:
The situation presented to the Committee seemed to be one of an upsurge of attacks that resulted in an upsurge in premiums and subsequent difficulties for Orange Halls in renewing their cover. However, that does not seem to be the case. Correct me if I am incorrectly interpreting your submission. My impression is that premiums increased substantially across the board after 9/11, after which the Grant Scott episode lasted for a couple of years. At that point, the relationship between the insurance companies and the Orange Order went slightly awry.
After that, the insurance industry attempted to provide some cover for quite a number of halls, and that happened. However, over that period rates remained fairly stable and there even seemed to be a reduction at some stage. In May 2007, in contrast to the previous two years there was no reduction, but the rates remained stable. Is that a fair summary?
Mr James:
When we talked about September 2001, the problem had been what happened in the preceding 10 years. Prior to then, the insurance companies had decided to continue to offer the renewal due to their long-standing connection with the halls. However, before 9/11, the position was that if a hall left an insurance company, that company would not reinsure it. That happened before the Grant Scott debacle and the insurers’ withdrawal from the market.
There was, therefore, a difficulty before 9/11 that a hall had to remain with a particular insurer. After the Grant Scott affair and 9/11, the entire situation changed. It is correct to say that the premiums had stabilised, but they were stabilised at perhaps double the level that one would expect for community halls.
Mr A Maginness:
The premiums were higher compared with those for other halls.
Mr James:
Yes. We stabilised the premiums, but at a high level, whereas the remainder of community-type halls, with the same level of cover, paid significantly lower premiums.
Mr A Maginness:
Did the Grant Scott scheme provide group insurance?
Mr James:
I do not know much about it, but premiums were debited to individual halls. He said that he was insuring those halls, but it was just a scam.
Mr Spratt:
You did not get any commission then?
Mr Boyles:
Word of mouth had got out.
The Chairperson:
There could be a separate debate on whether the sunset clause has been appropriately named — one thing that we can say with a reasonable degree of certainty about sunset is that the sun will rise again the following morning. [Laughter.] Everyone here will accept that, unless there is anyone who is particularly apocalyptic. I was going to say that we could save that debate for another day, but, judging by the Assembly agenda, it will probably take place next week.
I assume that Northern Ireland is treated as a unit when premiums are calculated, in the same way as it is for car insurance. Would a spate of attacks on community halls in Fermanagh affect premiums across Northern Ireland, including those in areas that have no history of attacks?
Mr James:
Yes, it would. In home insurance, postcodes are used to determine whether there is a higher risk of theft for homes on, for example, the Malone Road than those on the Antrim Road. Different rates then apply as a result of that decision. Premiums for community halls are calculated in the same way throughout Northern Ireland. However, individual claims are examined — if there have been two or three public-liability claims from one hall, the premium will reflect that. Northern Ireland, whether it is Fermanagh or Ballycastle, is treated as one unit when premiums are calculated.
The Chairperson:
I will not ask Committee members to declare an interest by stating their postcodes. Gentlemen, thank you for your evidence.
Mr James:
Six or seven years ago, we lacked confidence. Although confidence is everywhere in the media now, we are trying to bring confidence to the insurance market. By passing the legislation, we are taking attacks on community halls, which may be of a political nature, out of the insurance market. We are trying to give insurance companies confidence about the position on a long-term basis. Taking away such a big problem, and not including the sunset clause, gives confidence to the insurance market, the insurance companies and the ABI. The omission of a sunset clause will maximise the confidence of the whole community.
The Chairperson:
Thank you for your evidence, which will be very useful in the Committee’s deliberations. The Committee will draw up a report on the legislation, which will be debated in the Assembly on 4 November. From the time that the report is debated in the Assembly, it will be publicly available. The Assembly will send you a report. If either of you want to attend the Assembly debate on 4 November, you are more than welcome.
Mr James:
As long as you do not say, “bring yer man down for questioning”.
The Chairperson:
Do not worry; there will not be any questioning.
Mr Kennedy:
Sure, you are well insured.
The Chairperson:
If you cannot make it to the debate, and are more technically minded than I am, it is streamed on the internet. Thank you for your evidence, which will be very useful.
Mr James:
If the Committee requires anything else, give either of us a shout.