Insurance company increases discount to points-free drivers

THE Hibernian insurance company is to increase to 17.5% the discount it gives accident-free motorists who have not picked up any penalty points.

From November 1, qualifying drivers will be given a discount of 17.5% on their insurance premiums. Hibernian had been giving points-free motorists a discount of 10% since last November, the only motor insurer in the country to do so.

The company will now also offer the 10% discount to motorists who have received the minimum two penalty points for offences such as speeding or not wearing a seat-belt.

Announcing the decision yesterday, Dick O’Driscoll, managing director, Hibernian General Insurance said: “By increasing the penalty points free discount we offer, we are giving a further incentive to our customers to maintain a penalty points free licence.”

The decision is a boost for the Tánaiste and Minister for Enterprise, Trade and Employment, Ms Harney, who has campaigned for lower car insurance premiums. According to the Central Statistics Office, motor premiums on average are down by 13% since last July. In a statement, Ms Harney said: “Any reduction in insurance costs to consumers is to be welcomed.”

However, discounted premiums are unlikely to affect younger male drivers, with most motor insurers, including Hibernian, refusing to quote for those with provisional licences.

According to a survey by the Irish Financial Services Regulatory Authority (IFSRA), premiums vary by up to 500% and young drivers are the most heavily penalised.

The financial watchdog’s survey found that differences in the comprehensive motor premiums quoted by eight insurers for eight hypothetical consumers across a range of ages, professions, cars and licence types, varied from €303 to €5,110.

In its latest survey, three companies refused to provide cover to a 28-year-old male living in Dublin with a second provisional licence. Hibernian, Allianz and Royal & Sun Alliance also refused to quote female customers in this category.

Ms Mary O’Dea, consumer director of IFSRA, said the authority could not force insurers to operate in a particular market.

Record profits of €747 million, confirmed by the insurance industry last week, show it benefited hugely from lower claims in 2003 out of income derived from then higher insurance premiums. And half of last year’s net profits for non-life insurance came from motorists.

Meanwhile, IFSRA is seeking representatives and organisations to sit on consumer panels to replace the Motor Insurance Advisory Body (MIAB) after it publishes its final report later this year.

The MIAB has helped prompt some of the greatest changes the private motorist has seen in recent years, but it appears that about half its 67 recommendations have yet to be implemented in full. And a small number will not be progressed - the Department of Finance says it has no plans to abolish the 2% government levy on insurance which every driver pays.

A spokesperson for Tánaiste Mary Harney said her office has been concentrating on those initiatives most likely to reduce costs, such as the Personal Injuries Assessment Board (PIAB), road safety and reform of court procedures.