As Minister for Finance, I am responsible for the development of the legal framework governing financial regulation. My Department does not collect the type of information being sought by the Deputy. As the day to day supervision of insurance undertakings is a matter for the Central Bank of Ireland, my officials have consulted with the Central Bank in respect of the information sought and it has confirmed that it does not collect this information either.
With regard to the cost of insurance for cars over 10 years old, it is important to note that 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 vehicles.
Notwithstanding this, my officials engaged with Insurance Ireland in order to get a greater sense of this specific issue and, as a follow-up exercise, Minister of State D'Arcy held a series of meetings with the Chief Executives of the major motor insurers. At those meetings, insurers pointed out that in making their individual decisions on whether to offer cover and what terms to apply, they will, aside from the age of the vehicle, use a combination of other rating factors, which include the age of the driver, the type of vehicle, the relevant individual claims record and driving experience, the number of drivers, and how the car is used. In addition to the above factors, they indicated that they will price in accordance with their own overall past claims experience and in this regard, almost all insurers stated that their data indicates a notable deterioration in the levels of claims associated with vehicles once a certain age threshold is reached.
However, I also understand from the above engagement that it would appear there has been positive movement in respect of the acceptance criteria and the vehicle age threshold levels used by some providers in recent times, particularly at broker level and in respect of renewals. This is an issue which my officials will continue to monitor.
It is important to highlight that if a person is having difficulty securing a quotation or believes that they have received a high quotation as a result of having a car older than 10 years old, they should contact the free Insurance Information Service operated by Insurance Ireland, which can be accessed at firstname.lastname@example.org or 01-6761820.
Finally, I am hopeful that the continued implementation of all the recommendations from the Report on the Cost of Motor Insurance – in addition to those in the CIWG’s Report on the Cost of Employer and Public Liability Insurance and the two reports of the Personal Injuries Commission – should achieve the objectives of delivering fairer premiums for consumers and a more stable and competitive insurance market.