Dáil Éireann Debate, Thursday - 17 May 2018
54. Deputy Richard Boyd Barrett asked the Minister for Finance if his attention has been drawn to the fact that musicians have particular difficulty in obtaining motor insurance from motor insurance companies and in many cases are refused even a quote due to their profession; his plans to address the matter; and if he will make a statement on the matter. [21746/18]
View answerAs Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept. This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products. Consequently, I am not in a position to direct insurance companies as to the pricing level or terms or conditions that they should apply in respect of particular categories of drivers or vehicles.
In making their individual decisions on whether to offer cover and what terms to apply, insurers will use a combination of rating factors, which include the age and type of the vehicle, as well as the age of the driver, the relevant claims record and driving experience, the number of drivers, the profession of the driver and how the car is used, etc. My understanding is that insurers do not all use the same combination of rating factors, and as a result prices and availability of cover varies across the market. In addition, insurance companies will price in accordance with their own past claims experience, meaning that in relation to particular categories, different insurance companies will have different views.
However, it is acknowledged that pricing in the motor insurance sector has been subject to a lot of volatility in recent years with a related problem as referred to in the PQ being the availability of cover in the first place. These issues were the main impetus for the establishment of the Cost of Insurance Working Group. Its Report on the Cost of Motor Insurance was published in January 2017. The Report makes 33 recommendations with 71 associated actions to be carried out in agreed timeframes, set out within an Action Plan.
Work is ongoing on the implementation of the recommendations by the relevant Government Departments and Agencies and there is a commitment within the Report that the Working Group will prepare quarterly updates on its progress. The fifth such update was published on 11 May and shows that of the 50 separate deadlines set to date within the Action Plan, 40 have been met. Substantial work has also been undertaken in respect of the nine action points categorised as “ongoing”. Further details can be found in attached link. www.finance.gov.ie/wp-content/uploads/2018/05/5th-Progress-Update-Q1-2018-Focus.pdf.
It should be noted that the most recent CSO data (for April 2018) indicates that private motor insurance premiums have decreased by 19% since peaking in July 2016. While the CSO statistics indicate a greater degree of stability on an overall basis, these figures represent a broad average and therefore I appreciate many people may still be seeing increases. However, I am hopeful that the improved stability in pricing will be maintained and that premiums should continue to fall from the very high levels of mid-2016. In addition with the full implementation of the Motor Report, I believe that Ireland will be more attractive to new entrants thus increasing capacity as well as competition which should have a positive impact in niche areas such as musicians.
Finally, as the Deputy may be aware, under the terms of the Declined Cases Agreement (DCA), which is adhered to by all motor insurers in Ireland, if a consumer is unable to secure a quotation on the open market, he or she may be in a position to avail of the Declined Cases Agreement (DCA) process. Under the terms of the DCA, the insurance market will not refuse to provide insurance to an individual seeking insurance if the person has approached at least three insurers and has not been able to obtain cover from them. In this regard, there are further details available on the Insurance Ireland website while Insurance Ireland also operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance. The relevant contact details are: feedback@insuranceireland.eu or declined@insuranceireland.eu or 01-6761914.
