Car owners hit with up to 300% insurance hikes have been “thrown to the wolves” of the insurance sector by State institutions who are charged with protecting them, a damning report has found.
Insurance companies are heavily criticised by the report which states that a “closed mentality” and unwillingness to share data is a contributory factor to the recent rise in motor insurance premiums,.
It may also hinder the entry of new operators into the “dysfunctional” Irish market, the report concluded.
Tougher laws forcing insurance companies to reveal details of claims, awarding greater powers to the Personal Injuries Board(PIAB) and tougher penalties for drivers caught speeding or on their mobile phone while driving are among some of 76 key recommendations in the report.
The Joint Oireachtas Committee on Finance's Report on the Rising Costs of Motor Insurance was launched on Thursday in Leinster House.
The cross-party committee,which is chaired by Fianna Fail TD John McGuinness, expressed “serious concerns” about the bona fides of the insurance sector in promising to provide such details in the future of its own accord.
The report concluded that on average premiums have increased by 37%, but in some cases premium hikes have been in the order of 200%-300%.
“It is apparent that insurance companies in many cases are refusing even to quote insurance. In other instances, insurance companies quote but the amounts sought are so large that the net effect is to prevent people from getting insurance,” the draft report states.
It says it is unacceptable that the insurance industry publicly states that certain variables are behind steep increases in motor insurance, yet fail to publicly furnish the supporting evidence. “The insurance industry cannot have it both ways,” it added.
The Committee is deeply disappointed as to how consumers and citizens have been treated by the bodies mandated to protect them. The Committee is conscious of the roles of both the Competition and Consumer Commission and the Central Bank of Ireland (CBI) in this respect.
However, it is the consumer and policyholder who has suffered the most in this debacle.
The Insurance industry says it is the result of an increase in legal costs and compensation awards but will not supply supporting evidence for verification.
It would appear, to the Committee, that the Central Bank has abrogated responsibility for protecting
consumers by claiming European Law prevents it from getting involved in pricing and risk.
“Thus, it is the opinion of the Committee, that the consumer has been thrown to the wolves,” the report states.