Five of Ireland’s leading motor insurers have bowed to political pressure and are set to offer refunds or discounts to customers.
It comes amid an expected reduction in the number of claims that will have to be paid out due to the travel restrictions imposed during the Covid-19 crisis.
The move will provide further relief to customers in the crisis and follows a similar step by the country’’s major health insurance providers.
Allianz, AXA, FBD, RSA and Zurich have signed up to a commitment on premium reliefs for motor customers, according to Insurance Ireland, the industry representative body.
Given the different pricing models and different customer profiles of each insurers’’ books, the precise value of discounts and refunds will vary across the market. Each insurer will independently calculate the detail of the discounts or rebates involved and communicate with its customers in the coming weeks.
The announcement comes a week after the insurance sector found itself on the receiving end of a call by Finance Minister Paschal Donohoe to provide refunds to under pressure customers. Mr Donohoe had raised the matter on a conference call with Insurance Ireland, telling the industry representative body there was a "strong case" for customers to get refunds due to an expected reduction in claims.
He told operators they needed to be "proactive and generous" in their treatment of customers, in particular in the context of the very profitable nature of the market over the last 12 months.
Responding to the confirmation of the refund, the Finance Minister called on individual companies to come forward with information on the scale of the likely premium refunds.
"This is an important step by the sector and I also appreciate that these insurers will keep the matter under review to see how best they can serve the needs of their customers," Mr Donohoe said.
"Obviously it is for each insurer to look at its own situation and customer base, but I stress the importance for them to take a longer-term perspective and be generous with their customers at this time reflecting the recent profitability of the motor insurance market."
- The insurers agreed to the following:
- Each insurer will assess the impact on their customers and, in turn, pass on "appropriate financial supports directly to their customers"
- The financial supports - described as "refunds or discounts" - will reflect individual claims experiences to date
- If Covid-19 results in further restrictions on movement in the summer and beyond, insurers will "further review the situation"
Moyagh Murdock, CEO Insurance Ireland, said the sector recognises "the unique challenges" in the Irish market.
"This is good news for Irish motor insurance customers and comes following the introduction of a number of other supportive customer measures from Irish insurers spanning motor, home, business and health insurance.
Irish insurers understand that many customers are experiencing difficulties related to the Covid-19 crisis and are keen to assist wherever they can.