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Dáil Éireann debate -
Tuesday, 3 Oct 2000

Vol. 523 No. 1

Written Answers. - Motor Insurance.

John Gormley


178 Mr. Gormley asked the Tánaiste and Minister for Enterprise, Trade and Employment if her attention has been drawn to the concerns raised by the Motor Insurance Action Group about insurance for young drivers; the action she will take on this matter; and if she will make a statement on the matter. [19422/00]

I am aware of the Motor Insurance Action Group, although the group has not as yet communicated directly with our Department. I understand a good number of the demands of the group relate to the implementation of the WP extended char 4,29Road to Safety strategy and the introduction of a penalty points system for drivers. These are issues, which are being looked at by my colleague in the Department of the Environment and Local Government. The group also proposes the establishment of a non-profit making insurance company, specifically for young drivers with the suggestion that the company be subsidised where necessary by Government. Our Department has no plans to proceed with such a proposal.

The difficulties being experienced by young people in securing motor insurance and, indeed, the high cost of compulsory insurance cover for young drivers is, I understand, directly attributable to the adverse claims experience of such drivers as a risk category.

A report by Deloitte & Touche which evaluated insurance costs in Ireland found that the average cost of an insurance claim for 17 to 24 year old drivers was twice that for the 36 to 40 age group. The report also noted that motorists in the 17 to 24 age group were responsible for over three and a half times the total average claims costs incurred for motorists in the 36 to 40 age group.
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.
The Motor Insurance Advisory Board, which was re-established by me in 1998, was a major initiative aimed at providing information and advice on trends in motor insurance costs and with policy recommendations for addressing those costs. The board's membership includes a member representing young drivers' interests.
A number of initiatives are in place and are being taken to improve driving standards and safety awareness amongst 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.