Monday 5 December 2016

Kenny is urged to intervene on motor insurance

Published 05/11/2015 | 02:30

Conor Faughnan: 'The Central Bank of Ireland is insufficiently equipped to effectively regulate the motor insurance industry'
Conor Faughnan: 'The Central Bank of Ireland is insufficiently equipped to effectively regulate the motor insurance industry'

Taoiseach Enda Kenny has been called on to get personally involved in the motor insurance crisis and appoint a task force to sort it out.

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AA Ireland made the call, and said that changes it was calling for to the motor insurance market could see premiums cut by €80 for every driver.

Premiums have shot up by 35pc since the start of the year, the motoring body said.

AA Ireland's Conor Faughnan said: "The Taoiseach needs to intervene if this is going to be dealt with. It needs leadership from the very top, a job which is not getting done at the moment."

AA Ireland says it is the largest insurance broker in the country with 120,000 drivers on its books.

It recommended that a Government task force would look at a number of measures to prevent fraud, such as cutting legal costs, improving regulation, enhancing enforcement by improving technology for gardaí, and ensuring greater transparency within the insurance industry.

Flagged

Mr Faughnan also questioned how effective the Central Bank was at regulating the insurance industry.

"The Central Bank of Ireland is insufficiently equipped to effectively regulate the motor insurance industry," he said.

He said the regulator had flagged in March that it was 40pc under-resourced in insurance regulation.

"With Setanta and Quinn costing the consumer €200m between them, this is unacceptable," he said.

In an in-depth report on the motor insurance industry, AA Ireland also questioned the high element of legal costs associated with claims.

Motorists pay €200m a year in legal costs for motor insurance claims. Mr Faughnan said legal costs account for 60pc of costs of litigated cases.

He also said payments for injuries such as whiplash average €14,000 in Ireland, but are €5,000 in the UK.

He said there is a need for an integrated data-sharing system that would allow insurers and brokers share information.

Irish Independent

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