Higher premiums on the way, as insurers probe penalty points
Premium hikes on the cards for worst offences
Published 26/08/2011 | 05:00
MOTORISTS will be hit with higher insurance premiums, depending on the type of penalty points they have, under plans to give the insurance industry power to probe a driver's history.
For the first time, insurers will be able to call up a person's driving record to see their 'rap sheet' and discover exactly what offences they have committed.
The companies will be able to penalise drivers based on the nature of the points they have incurred -- rather than the current system, which simply takes the number of points into account.
Certain penalty-point offences will be 'weighted' to incur a higher premium -- these include driving under the influence of drink or drugs and careless driving.
Details of the plan are being worked out by the Department of Transport, which is anxious to finalise a deal early in 2012.
The insurance companies will be under pressure to pass on any savings to drivers who have no points on their licence -- but it is unclear if this will happen until the new system has been put in place.
Until now, just one company, Aviva, could access the information on the national vehicle driver file, a confidential database showing drivers' penalty points.
Even then, its staff could only see the number of penalty points clocked up by named drivers, not the type of offences.
Aviva did a deal with the Government nine years ago to get access to the database, so that it could offer lower premiums to drivers with no points. Since then, no other insurer has reached a similar agreement.
Under the proposed change, all companies will be able to instantly look up the exact nature of the offences, as well as the number of points imposed on drivers.
The country's biggest insurer, AXA, told the Irish Independent yesterday that it would be be imposing "severe" loading on any driver found to have penalty points for drink driving.
Hefty premiums will also be imposed for those with points relating to any dangerous or careless driving behaviour, the company confirmed.
Paul Moloney, AXA head of corporate affairs, also warned that any driver not declaring points for these offences on renewal forms would have their policies voided in the event of a crash.
Other insurers are expected to follow suit with punitive premiums for risky drivers.
Current loadings for drink driving are as high as 150pc of the cost of the insurance.
The move will have massive repercussions for those drivers who get three penalty points, instead of going to court, under the new drink-driving laws.
A new, lower limit of just 50mg of alcohol per 100ml of blood will be introduced next month. While drivers who are caught between 50mg and 80mg will not be put off the road, they face penalty points.
And that means massive hikes in their insurance premiums when they come to renew their policies -- because the companies will be able to check them out.
A Department of Transport spokesman said talks were continuing with the insurers, with a view to allowing them access to specific information on penalty points relating to the nature of the offences.
The new Road Traffic Act, which has already been approved, provides for all insurance companies to get real-time information on penalty points.
Issues surrounding data protection are still being ironed out, but the new system is expected to be operational early next year.
And it hopes this would have an impact on further cutting road deaths.
"The department is very keen to come to an agreement with the industry on this," the Transport spokesman added.
"We expect the process to last around six months and are very keen to see a positive outcome which would allow information on specific offences stored on the driver file to be shared with insurance companies."
Niall Doyle, of the Irish Insurance Federation said: "We would welcome anything that would help insurers identify risk more clearly and therefore help to prevent road accidents and fatalities."