Dáil Éireann debate -
Tuesday, 4 Apr 2000

Vol. 517 No. 3

Written Answers. - Motor Insurance.

Nora Owen

Question:

80 Mrs. Owen asked the Tánaiste and Minister for Enterprise, Trade and Employment if her attention has been drawn to the fact that persons of 17 years of age are unable to obtain motor insurance; the measures, if any, in place to protect young drivers and ensure that they receive motor insurance; the plans, if any, she has to review these procedures; and if she will make a statement on the matter. [9837/00]

Minister of State at the Department of Enterprise, Trade and Employment (Mr. Treacy)

The difficulties being experienced by young people in securing motor insurance and, indeed, the high cost of compulsory insurance cover for motorists, in particular young drivers, is, I understand, directly attributable to adverse claims experience of young, especially male, drivers as a risk category. The 1996 Deloitte & Touche report on an economic evaluation of insurance costs found that the average cost of an insurance claim for 17 to 24 year old drivers is twice that for the 36 to 40 age group and that motorists in the 17 to 24 age group are responsible for over three and a half times the total average claims costs incurred for motorists in the 36 to 40 age group.

My re-establishment of the Motor Insurance Advisory Board was a major initiative aimed at providing us with information and advice on trends in motor insurance costs and with policy recommendations for addressing those costs. The board, whose expanded membership includes a member representing young drivers' interests, has undertaken an ambitious programme of work and research, particularly in relation to the basis of charges to young drivers. EU law prevents me from intervening directly with the insurance companies in the matter of premium levels or in respect of what risks they are prepared to underwrite. Therefore, the primary focus of initiatives aimed at reducing the cost of motor insurance for young drivers must be on reducing the frequency of accidents and the associated cost of claims. The key to this is to create appropriate conditions for improving their standards of driving and their appreciation of road safety.

A number of initiatives are in place and are being taken to improve driving standards and safety awareness among all drivers, including young drivers. The Irish Insurance Federation, in conjunction with the Driving Instructors Register, has introduced a scheme of insurance premium discounts for the young driver on completion of a required number of driving lessons. The National Safety Council, in co-operation with the Garda, continues to promote anti-speeding and anti-drink driving media campaigns, including road safety educational programmes for secondary school students. My colleague, the Minister for the Environment and Local Government, Deputy Dempsey, has been asked to look at a graduated licensing system for learner drivers, based on the Ontario model which could have a significant impact if introduced here in Ireland. For those motorists who are having difficulty getting a quote for motor insurance and in recognition of the compulsory nature of third party motor insurance the declined cases agreement between the Minister for Enterprise, Trade and Employment and the Irish Insurance Federation offers the motorist the opportunity of a motor quotation subject to certain criteria.