Vol. 481 No. 7
111 Mr. Naughten asked the Tánaiste and Minister for Enterprise, Trade and Employment the intentions, if any, she has to reduce the enormous cost of car insurance for young drivers; and if she will make a statement on the matter. [17133/97]
The issue of reducing motor insurance premiums for young drivers was examined in some detail in the Deloitte & Touche report on "An Economic Evaluation of Insurance Costs in Ireland", published in October 1996. The report found that premium rates for younger drivers are high in all EU countries relative to the rates charged to more mature drivers. This reflects the significantly higher risk they represent for insurance companies in providing insurance cover. The consultants found that the average cost of an insurance claim for 17 to 24 year old drivers is over twice that for the 36 to 40 age group and that motorists in the 17 to 24 age group are responsible for over 3½ times the average claims costs of motorists in the 36 to 40 age group. In addition, the National Roads Authority Annual Report for 1995 indicated that almost 38 per cent of the motorists involved in fatal and personal injury accidents in 1995 were young drivers and that 41 per cent of the road casualty victims in 1995 were between the ages of 18 and 34.
The Deloitte & Touche report also considered the question of spreading premium rates more evenly across the different risk categories of motorists and concluded that reducing the premiums for the young motorist at the expense of increasing premiums for the mature and safer motorist would reduce the incentive for safer driving. Also, by increasing the pool of young high-risk motorists, it would result in an overall increase in the cost of claims leading to higher premium rates for all motorists.
The report concluded that the solution to lowering premiums for young drivers is to improve their driving standards and accident-claims record. The report recommended that a graduated licensing system for learner drivers, similar to such a scheme operating in Ontario, should be evaluated with a view to the possible introduction of a similar scheme here. The Ontario model is currently being examined by the Department of the Environment and Local Government.
Of more immediate benefit to young drivers in Ireland is the Insurance Incentive Scheme recently established by the Irish Insurance Federation and the Driving Instructors Register wherby insurance discounts will be granted to young drivers who have completed a required number of driving lessons. The National Safety Council is also working to produce course material on road safety for primary schools and for transition year students in secondary schools.
