Finance Committee report criticises “dysfunctional” motor insurance market

24th November 2016

Some of the report’s key recommendations include:

•  An end to  the “closed shop” mentality of the industry and calls for full transparency in relation to claims information;  

•  Calls for the Central Statistics Office to be given a statutory role in collating insurance data;

• Recommends that consumers be given detailed cost information in renewal notices;

• Calls for more pro-active regulation of the industry by the Central Bank of Ireland with a greater focus on consumer protection;

• Recommends that insurance companies be compelled to inform the consumer whether they have taken into account the mandatory medical assessments for over 70s drivers when calculating insurance premia for this cohort;

• Greater powers for the Personal Injuries Assessment Board (PIAB), with the objective of increasing the number of  claims cases settled by PIAB, thereby reduces claims costs generally;

• Insurers be compelled to notify customers in advance of settling claims made against them;

• Recommends that the Book of Quantum be reviewed and updated on a regular basis;  

• Recommends that recent changes to the monetary jurisdictions of the civil courts be reviewed.  

Committee Chairman John McGuinness TD, said, “Spiralling motor insurance premiums is making insurance unaffordable for many people and adding also to business costs. The report the Committee has launched today seeks to address the underlying factors contributing to the rising costs of motor insurance and to make recommendations to reverse this unsustainable situation.”

“This cross-party report offers 71 recommendations which we believe can contribute significantly to addressing the lack of transparency, as well as the unfairness that is rampant in the market. We are calling for competition to be encouraged and for fundamental data-sharing to be mandatory in the insurance sector. The judiciary should also consistently use the revised Book of Quantum.”

“Many claims are settled outside PIAB and the courts and the insurance company pay-outs are essentially invisible. We are calling for insurance companies to be compelled to provide detailed information on claims settled outside of PIAB and for PIAB to be modernised.”

“Our Committee believes that it is long past time to ensure that policyholders can expect to obtain insurance at a reasonable price. We share consumers’ frustration at the lack of fairness in the pricing regime and we are urging the Cost of Insurance Working Group in the Department of Finance - chaired by Mr. Eoghan Murphy TD, Minister of State – to work to implement some or all of our recommendations.”

Read the report here.

ENDS/