Motorists, in particular young motorists, are facing unacceptably high motor insurance premiums in this country. On average the cost of motor insurance is three times greater than in Northern Ireland and the United Kingdom.
Young motorists are particularly affected by the high cost of insurance premiums with some companies reluctant to even quote them. The high cost of insurance is borne out by the following examples which I discovered today. One young motorist in Portlaoise was quoted £1,746, whereas an 18 year old from County Wicklow was quoted £1,226. Indeed I heard on the radio today of a case where a young motorist was quoted £1,500, which was a rise of £700 on his previous premium. Insurance companies will tell us that the increases have been in the region of 20 per cent to 30 per cent. However, this shows conclusively that the rise is more like 70 per cent to 90 per cent and it is totally unacceptable. It deprives a large number of young people of the right to drive and in some cases deprives them of employment opportunities.
It is clear that continued increases will further push motor insurance out of the reach of greater numbers of young people. To seek to reduce the cost of motor insurance here we must first identify the reasons for the high cost and examine the means to reduce these costs.
It is clear that the high cost of insurance is directly as a result of the losses made by insurance companies. Underwriting losses on motor insurance have increased from £18 million in 1986 to £90 million to a £100 million in 1989 and will increase further this year.
It is estimated by the Garda that uninsured drivers make up 8 per cent to 10 per cent of the total number of drivers at an estimated cost to the industry of £30 million per year. This adds approximately £30 to the cost of insurance for each motorist. The Garda estimate that somewhere in the region of 80,000 to 100,000 cars are driven around each day without insurance. There is a low conviction rate in this area.
The accident rate in Ireland is the highest in Europe at present. About 8,500 people were injured in motor accidents in 1989. The number of injuries arising from road accidents in 1989 increased by 5 per cent over 1988. The numbers which are not available for this year are likely to be greater, I understand. Action must be taken to tackle this problem.
The means by which we test the quality of our drivers is the driving test. I have in the past expressed concern over the unacceptable length of waiting lists for tests. I welcome the increase in the number of testers by the Department but I dispute the claim that this will clear the backlog within one year. It is estimated that, prior to the increase in the number of testers, it would take up to eight years to clear the existing backlog without any new applications.
The average third party injury claim in Ireland is six times higher than the equivalent figure in the United Kingdom. Despite the Courts Bill and the subsequent abolition of the jury system, awards have increased instead of decreasing. The number of claims has also increased by over 5 per cent in the past year.
Another factor is the number of provisional licence holders. There are about 230,000 people on provisional licences in this country at present. There is no control in this country on the granting of provisional licences.
I recognise that the cost of the insurance premiums for young people is higher than that for other drivers because of the higher number of claims in this sector. The Irish Insurance Federation claim that the relative claim cost for policy holders in 1988 under 25 years was 79 per cent above average.
We must do something about this scenario. I have a number of proposals which I will briefly outline. We should introduce a personal insurance disc which would make detection of uninsured drivers easier. For provisional licence holders we should have a module in our schools on road safety and rules. Little reference is made in schools to road safety and rules, and most youngsters do not know the rules of the road. There should be a written or oral test prior to the granting of provisional licences. There should also be a compulsory course which would provide credits towards the final test. A similar system operates in parts of the United States very successfully.