Saturday 22 October 2016

More than a third of motorists hit with insurance hike of up to 50pc

Published 30/12/2015 | 11:23

Premiums are up 35pc since January 2014.
Premiums are up 35pc since January 2014.

MORE than one third of motorists have seen the cost of their insurance rise by up to 50pc this year.

  • Go To

This has prompted thousands of drivers to reduce their levels of insurance cover in an attempt to manage costs, says the AA.

A rise of this amount means that someone paying €500 last year is now being quoted €750.

And the motoring  body warned that premiums for the State’s two million drivers are set to continue to rise into next year unless major reforms are put in place by insurers and the Government.

An AA motor Insurance survey of over 5,000 motorists reveals that 34pc have seen their insurance premiums rise by between 20pc and 50pc when compared with 2014.

Another third of motorists surveyed said they are forking out up to an extra 20pc this year.

A quarter of policyholders saw no change in the cost of their premiums.

A tiny minority of just 5pc of drivers witnessed a cost reduction.

Chief executive of AA Ireland Brendan Nevin said ordinary drivers were being asked to carry an unacceptable burden.

“After a long period of cost stability, average prices have risen by almost 40pc since January 2014,” he said.

“If the root causes we’ve identified are tackled head on, we can quickly create a stable and sustainable market for motor insurance. If they are not, then we will continue to suffer uncertainty, market failures and unacceptably high prices.”

Fraudulent activity, high legal and claims costs, poorly resourced regulation, low levels of enforcement as well as a lack of industry transparency have cost motorists dearly, according to the AA.

Irish drivers will collectively pay €300m in extra premium costs this year, the motoring body said.

The AA Motor Insurance survey indicates that the premium hike has motorists scrambling for ways to help drive down the cost of their policies.

Over one in four motorists say they were forced to purchase lesser cover and risk facing heavier financial consequences from a potential accident.

Almost 40 percent are adding a “responsible partner” to their policy in the hope of minimising costs.

Other attempts at cost-saving measures include increasing the insurance excess fee, improving vehicle security, driving less to reduce mileage, and using a garage to park a car.

Most motorists are having to spend time shopping around in an attempt to get the best price.

“The problem is that motor insurance is a legal obligation, which essentially leaves motorists with no choice but to stump up the costs,” added Mr Nevin.

The AA wants to see an independently chaired task force to tackle reforms, including representatives from the Insurance industry, the Departments of Justice, Transport, and Finance, An Garda Síochána, and legal industry.

Online Editors

Read More

Promoted articles

Editors Choice

Also in Business