Fianna Fáil spokesperson on Jobs, Enterprise and Innovation Dara Calleary has described efforts made by the outgoing government to tackle soaring motor insurance premiums as extremely feeble. Speaking during a Dáil debate this afternoon, Deputy Calleary highlighted the need for action to be taken to provide relief to consumers and businesses who are bearing the brunt of rising costs.
Deputy Calleary commented, “Insurance premiums have been rising relentlessly for families and businesses. Motor insurance is up by 32% in twelve months and 50% in just over four years. This is putting a massive strain on family finances and completely unsustainable.
“These increases reflect a combination of government imposed costs, poor regulation, mis-management by the insurance sector and legislative failure.
“Fianna Fáil is setting out clear proposals to tackle motor insurance costs. This would involve re-establishing the Motor Insurance Advisory Board which was previously successful in reducing motor insurance premiums. The board could examine the profitability of the industry, the settlement of claims and the impact of false and exaggerated claims on premiums.
“We cannot rely simply on data from insurance companies to justify increases. 71% of personal injuries claims do not go through the courts or PIAB. There is no transparency regarding the cost of settling claims or awards in these cases. Yet we are being asked to take the industry’s word for it that premiums must go up because of increased awards and costs.
“There’s no question that there is a problem in relation to false and exaggerated claims. Very few cases of insurance fraud are referred by the courts to the Director of Public Prosecutions and those that do make it to court rarely end in a custodial sentence. Sentence guidelines are needed to ensure that an adequate deterrent is in place.
“In the UK, the Financial Conduct Authority has introduced a change which requires insurers to disclose the previous year’s premium on renewal notices for retail insurance policies. The information must be clearly shown and allow comparison with the quoted renewal premium. A similar provision should be introduced in Ireland. This would encourage consumers to seek cheaper quotes and help tackle the so called “loyalty premium” which results in customers paying more than they need to for the same level of cover,” concluded Deputy Calleary.