Motorists to be informed why their insurance premiums change
An annual database on motor insurance trends will be published by the Central Bank starting from next year, writes .
Motorists to be informed why their insurance premiums change
The decision was taken by Cabinet yesterday and will see motorists informed why premiums go up or down. Consumer advocates and opposition TDs have been outraged over the sky-high rates being charged by insurance companies in recent years.
The European Commission last year even carried out raids on motor insurance companies in a bid to check if they were engaging in anti-competitive practices.
The Cost of Insurance Working Group recently presented its first report to the Government. The first steps towards the new group were set up by Housing Minister Eoghan Murphy, when he was junior minister for finance.
The Cabinet has examined the report and yesterday agreed that a National Claims Information Database will help facilitate a more in-depth analysis of annual trends in motor insurance claims.
This will help shed light on how claims costs are having an impact on premiums, and understanding the relationship between the price paid by a customer for motor insurance and the cost to insurance undertakings.
The Central Bank will publish an annual report on the data. However, a government spokesman could not say if this would include actual details or names of specific insurance companies and their rates being charged.
Nonetheless, it is hoped the data published will increase transparency on the relationship between insurance premiums and related costs, said the Government.
Drivers in recent years have been charged multiples of their premiums with insurers often claiming that the level and costs of accidents are contributing towards the sharp rises.
The government says the new database will identify current and emerging trends in the market, the factors that drive movements in the price of insurance and the number of claims annually.
The last government had blamed motor insurance rises on the frequency of claims by drivers, on the fact the amounts claimed had also risen and there had been a rise in legal costs. New material and figures that will be published in the database by the Central Bank will also provide statistical analyses of the costs associated with settling claims as well as, the Government said, an “understanding [of] the settlement channels used”.
Fianna Fáil’s Michael McGrath, who has been trying to drive reform of the sector, has previously said: “Seven out of every 10 claims are settled out of court by insurance companies, with no register or evidence as to consistency with regard to the settlement of those claims.”
