Give drivers a fair deal, McCreevy tells insurers

FINANCE MINISTER Charlie McCreevy yesterday warned the insurance industry to cut the cost of car cover and give motorists a fairer deal.

In a speech to Irish Insurance Federation (IIF) members, Mr McCreevy said he wanted to see a significant fall in premiums over the next couple of years.

Mr McCreevy said he would not accept claims by the industry that the Irish market was uncompetitive.

The Government was introducing numerous measures the industry had called for, such as the recommendations of the Motor Insurance Advisory Board report and better enforcement of road traffic laws, he said.

“But I must emphasise that the Government expects an unambiguous response from your industry in the shape of significantly lower insurance premiums,” he said.

“Failure to deliver on lower premium levels would make it more difficult for the industry to defend itself against charges that the Irish market is not competitive.”

Already Hibernian, which claims to insure about 30% of all Irish motorists, has said drivers without penalty points will be entitled to a 10% reduction in their premiums.

However, drivers who incur more than five points may end up paying more for insurance cover.

Hibernian is the first motor insurer to link premium rates with penalty points following a meeting with the Minister for Transport, Séamus Brennan.

It has said its commitment is subject to gaining access to the National Driver File, where details of points levied on individuals are recorded.

President of the Irish Insurance Federation, Peter Towers, hit back at Mr McCreevy, saying the only way to lower the costs of motor insurance was to reduce the cost of claims.

He called on the Government to increase investment in road safety and publish a new national road safety strategy, moves it believes would lead to reduced premiums.

“It has been conclusively proven in relation to road safety that the economic payback to the State and to the economy in general from investment in road safety is very significant indeed,” Mr Towers said.

The National Safety Council said there had been significant reductions in road accidents in the last six months since the introduction of penalty points.

The Competition Authority is investigating the insurance industry following complaints consumers are being ripped off.

The IIF said motor premiums here were high as there were few players in the market due to the cost of claims.