03 May Motor Insurance Increases By 38% In One Year
Motor insurance prices as measured by the Central Statistics Office have increased by 38.3% in the last 12 months.
The figures published by the Consumer Price Index have caused alarm among consumer groups and government departments. The recent increases have contributed to the overall annual inflation rate hitting 0.5%.
A number of the leading insurers in Ireland have warned about future premium increases. The recent rise in premiums has been blamed on the increase of fraudulent claims, uninsured drivers and high claim pay-outs. The aggressive price wars of previous years have also hurt insurers in terms of catering and paying out on claims.
With serious pressure being placed on the government, an inter-departmental working group on insurance costs has been set up to tackle the problem. Headed by Minister of State Eoghan Murphy, the working group has only met once with their 2nd meeting which was due to take place on September 2. The key task were to examine the factors which have led to premiums increases and to recommend steps to influence the situation.
The government acknowledges that costs have increased disproportionately for certain groups such as younger drivers and those over 65. Returning immigrants are also experiencing problems obtaining car insurance with little or no previous driving history in Ireland to demonstrate.
One of the other issues for concern relate to the fact that people are bypassing the personal injuries board and going direct to court. Pay-outs in court tend to be higher and this route of litigation is often preferred by legal advisors.