Business Irish

Saturday 10 December 2016

Motor Insurance premiums fall for the first time since early 2014

Published 10/11/2016 | 12:33

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Motor insurance premiums fell last month, for the first time in years.

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New inflation figures from the Central Statistics Office show that motor insurance costs fell by 8.2pc in October compared to the previous month.

This is in contrast to rises of close to 40pc in the summer.

The cost of insuring a car and van has been rising consistently since January 2014.

And the last time there was a decrease in the monthly cost of cover was close to three years ago.

But despite the fall in premium rates in the month of October, the cost of cover was up 8.5pc when compared with October last year.

Economist with Davy Stockbrokers Conall Mac Coille said the fall in the monthly cost of insuring a vehicle may not point to a trend yet, but it was still significant.

“The cost of motor insurance has been sky-rocketing since the beginning of 2014. The sudden fall in October is the first significant decline we have seen January 2013,” he said.

Insurance experts said that companies have now hiked premiums to such an extent that they may finally be able to break even.

The Competition and Consumer Protection Commission has summoned insurers to give evidence to it over suspected breaches of competition law.

The competition watchdog said it was concerned that motor insurers were signalling price increases to each other before raising prices.

This is seen as cartel-like activity – where players in a market who are supposed to be competing against each instead other act to regulate prices.

It said it was concerned that motor insurers were signalling price increases to each other before raising prices.

This is seen as cartel-like activity – where players in a market who are supposed to be competing against each instead other act to regulate prices.

Overall consumer prices fell by 0.3pc in October on a yearly basis on the back of cheaper petrol and diesel, cars, air fares and some food prices.

The CSO said that consumer prices were down 0.5pc in October compared to September.

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