Increases in motor premiums are being driven solely by the cost of claims, according to Insurance Ireland chief executive Kevin Thompson.
Mr Thompson said Insurance Ireland has “no problem whatsoever” with the Competition and Consumer Protection Commission investigation into anti-competitive practices in the industry. He said the company plans to fully comply.
“We’re satisfied there is no issue in relation to competition practice,” said Mr Thompson.
“As an industry we know exactly what the drivers are in respect of premium increases. Premiums are driven by the cost of claims and unfortunately in the claims environment we’ve seen a lot of volatility.
“From our position, premiums are driven solely by the cost of claims. Insurance in some ways is a very simple product, claims have to be funded,” he told Morning Ireland.
Increases in the level of awards, litigation costs, and in the frequency of cases have acted as contributing factors in determining motor insurance premiums, said Mr Thompson.
“The court limits increase in February 2014 has had a retrospective effect, which has to be priced for now and obviously we’ve got the issue in relation to Setanta.
“This is all feeding through in terms of the cost of claims. It ultimately feeds through into premiums.
“If you look at the performance of the industry, from 2010-2015, total underwriting losses have come at €823m, motor underwriting losses have come in €853m — I think we have to try and move the debate along.”
Various organisations have called for greater transparency within the motor insurance companies and requested insurance companies to publish data relating to claims during meetings of the joint Oireachtas committee this week.
However, Mr Thompson said Insurance Ireland does share information.
“You could actually fill this room with the amount of information we supply our independent regulator,” he said.
Mr Thompson said Insurance Ireland has shared information with the Personal Injury Assessment Board to contribute towards revisions to the Book of Quantum, as well as a detailed analysis of rates from the Central Bank in 2015.
Insurance Ireland is due to speak at a meeting of the joint Oireachtas committee today, following a week of sessions discussing the rising costs of motor insurance.
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