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Monday 20 November 2017

Drivers hit with 13pc insurance increase

John Meagher has seen the motor insurance premium he was quoted jump 50pc in a year. Ronan Lang
John Meagher has seen the motor insurance premium he was quoted jump 50pc in a year. Ronan Lang
Charlie Weston

Charlie Weston

THE largest insurance company in the country has admitted it has imposed huge hikes on motor premiums.

RSA Insurance, which owns 123.ie, said it pushed up premiums by 13pc in Ireland this year.

The rise is a multiple of what has been imposed by other motor insurers – prompting fears that others will now follow with double-digit hikes.

Motorists have been warned to be extra vigilant to ensure they are not stung by spiralling hikes. The state body that handles motor-injury claims said there was no basis for a rise in premiums.

Head of the Injuries Board Patricia Byron said her organisation was saving money for insurers by taking claims cases out of the courts.

The company denies it is "profiteering". RSA, which says it is the largest general insurer in this market, said higher injury claims were the reason for the bigger premiums.

The move comes at a time when motor premiums have barely moved.

The latest data from the Central Statistics Office shows that

motor premiums rose by just 0.1pc in September, indicating that RSA is out of line with its competitors.

RSA purchased 123.ie for €60m in 2010.

Ms Byron said the Injuries Board saw no justification for higher premiums, despite a higher number of claims in the first six months of the year.

She stressed that the number of claims before the board had slowed down in the July-September period.

"In the context of current claim trends, the board sees no basis for insurance premium hikes at this time in Ireland.

"I would also reiterate that we have delivered processing cost savings of €26.8m in the first half of this year."

She said the board had reduced the processing fee it charges insurers by 30pc from the start of this year.

ASSESSMENT

By law, personal injury claims must come to the board for assessment before going to court, even if the consumer has legal representation.

The board said road traffic accidents continued to account for the lion's share of personal injury claims. They accounted for three out of four awards in the first half of this year, a period when total compensation increased by 8.3pc to €118m.

There were close to 5,300 claims in the first six months of 2013.

And chief executive of the Consumers' Association Dermott Jewell warned of a price spiral in motor premiums.

He advised drivers to avoid being sucked into paying higher premiums by questioning every aspect of a renewal quote or new quotation received.

Mr Jewell said: "RSA's strategy of pushing up premiums by 13pc is absolutely appalling in the middle of a recession. It does nothing for the country."

Chief executive of RSA Ireland Philip Smith, who is also president of the representative body Insurance Ireland, was not available for comment.

But a spokesman for the company denied it was profiteering.

"The answer to that is absolutely not."

And he dismissed claims that RSA was attempting to recoup the €60m outlay on 123.ie by raising premiums.

The higher motor premiums reflected higher claims for injuries to motorists, he said.

He denied that the new EU gender directive – which meant that women and men have to be charged the same insurance rates – had any role to play in the higher premiums.

Irish Independent

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