Sunday 17 December 2017

Motorists' insurance bills are up by €350

Premiums have risen by as much as 70pc at times, as the industry has been imposing higher costs on drivers for three years now. Stock photo: Getty
Premiums have risen by as much as 70pc at times, as the industry has been imposing higher costs on drivers for three years now. Stock photo: Getty
Charlie Weston

Charlie Weston

Motorists are shelling out an average of €350 more a year for insurance due to the massive hikes imposed on them.

The premium hikes has been calculated at a combined €700m a year.

Unprecedented surges in the cost of premiums is one of the main reasons EU cartel busters are here raiding insurance companies, their representative bodies and brokers.

Premiums have risen by as much as 70pc at times, as the industry has been imposing higher costs on drivers for three years now.

Commission officials have been here for the past few days, investigating allegations of cartel activity in the motor insurance industry.

However, the Central Bank has refused to comment on reports that it has been contacted by the EU officials.

The Central Bank regulates insurers, and has in the past told them to raise their prices to ensure they are not losing money.

It said it had no comment when asked if the EU raids will prompt any changes in how it carries out its regulation role.

Data collected by the Central Bank shows that net motor premiums collected by insurers were around €1bn in 2013.

Figures in the Government's cost of insurance working group indicate that premiums have shot up by 70pc between 2013 and July last year.

This implies that an extra €700m is now being charged to motorists for their cover.

Read more: Motorists to be hit with cost of boosting insurance fund

With around two-million vehicles on the road, the calculations mean drivers are paying out an additional €350 a year for their cover.

Meanwhile, European Union competition enforcers continued to raid insurance bodies yesterday.

The Dublin offices of global insurance broker Aon has finally admitted it was raided, having refused to comment earlier in the week.

It said in a statement: "Aon's Dublin office was visited by the European Commission as part of a wider investigation.

"Aon takes compliance and regulatory issues extremely seriously and is working diligently with the European Commission, while at all times remaining focused on clients and their needs."

Other brokers raided include the Dublin offices of international intermediary Marsh, along with Wright Insurance Brokers in Wexford. It comes after a dawn raid on Tuesday at Insurance Ireland, the representative body for the sector.

Commission officials, accompanied by Irish competition authorities, are turning up at offices demanding to see named executives and confiscating mobiles, laptops and desk tops.

The raids come 10 months after the Competition and Consumer Protection Commission started a probe into alleged cartel activity in the insurance industry.

Last year Zenith Insurance stopped offering car coverage in this country. One of the reasons it gave was a lack of engagement by Irish industry bodies, which it said had created a market disadvantage. At the time it was the largest Gibraltar-based motor insurer here.

Irish Independent

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