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Return migrants facing sky-high car cover costs


Conor Faughnan of AA Roadwatch

Conor Faughnan of AA Roadwatch

Conor Faughnan of AA Roadwatch

Colossal car insurance rates are preventing emigrants from returning home because they are treated like "first-time drivers" all over again, the Sunday Independent has learned.

Motor insurance experts say the spiralling cost of comprehensive cover could have a major impact on Taoiseach Enda Kenny's intention to lure 70,000 emigrants back by 2020.

Emigrants who have been gone for more than two years are being told that their 'no claims bonus' no longer applies as it is "impossible" for insurance companies to check the driving records of clients that have been living abroad.

One expat, who has been living in Melbourne for the last five years, says he is reconsidering plans to move home after being quoted an insurance rate of €5,400 for a 2004 Audi A4 - a car worth an estimated €4,000. He was paying just €450 for car insurance on the same car before leaving in 2010.

Conor Faughnan, director of consumer affairs at AA Ireland, says although the price of cover has gone up across the board, returning emigrants are bearing the brunt. "In essence, people returning from overseas are getting treated as if they are first-time drivers all over again because it becomes impossible for an insurer to check their status," he said.

"If you have a big gap on your record, the insurance companies can't see what your penalty points record is, can't see what your claims history is, and because they have no data, they sort of have to assume the worst, so you get rated as if you have a poor claims history or poor penalty points status," he said.

"It feels unfair and there is no doubt that it is harsh on people. It's something that you've got to factor in as one of the hidden costs of returning home," he said.

Although Mr Faughnan says insurers deserve a lot of criticism for their behaviour over the last 12 months, he says their treatment of returning emigrants is "somewhat justified".

"To some degree, an excessive insurance premium is understandable. They're blind to the data, they can't see their history. They've got no access to their insurance record or police records, they can't confirm anything," he said.

Eimear Beattie, president of Irish Families in Perth, says concerns about car insurance have been raised by a multitude of emigrants planning to move home.

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"It is emerging as a major barrier for five-year planners with families. Many fear they would be better off here than go back, due to this issue," she said.

Mr Faughnan says the insurance companies should be doing a lot more to reduce the motor insurance burden.

"Let's be realistic, Australia is a country that legally and culturally is quite similar to Ireland, there isn't even a language barrier. It is presumably readily possible to be able to properly check if a driver has a clean history and they should be looking at ways to do that," he said.

"They didn't even have to switch sides of the road so they may be on the other side of the globe but really they haven't travelled very far at all," he said.

Piaras Mac Éinrí, lecturer in migration studies at University College Cork, says far too little attention is being paid to the general costs of returning home.

"Would-be return emigrants face multiple hurdles now, notably in housing, insurance, transferability of pension rights and rising costs for health care which in most cases will be inferior than that available in the countries where they are now," he said.

"Cutbacks in pay levels and uncertainty in contract terms mean that in certain cases there can be considerable gaps in wages and prospects elsewhere and here. These are powerful incentives for staying away," he said.

Marie-Claire McAleer, head of research and policy at the National Youth Council of Ireland, is calling on the new Government to prioritise and tackle the obstacles that returning expats face.

"It is really important that return migrants are welcomed back to Ireland and that their transition is as smooth as possible," she said.

"Although work has been done to address some of the barriers to return experienced by young Irish emigrants, many challenges remain," she said.

"The imposition of costly penalties, like car insurance, serves to both inhibit the prospect of return and make returning to Ireland more difficult. In order to encourage, support and facilitate return migration back to Ireland, these issues need to be resolved," she said.