Words by Conor Faughnan, Director of Consumer Affairs at AA Ireland
For the Irish motorist the big issue of 2015 is rising motor insurance prices. We are seeing a year-on-year increase of about 20% for ordinary drivers with ordinary insurance risks. Anyone who has a non-standard risk for any reason could face an even bigger increase and may struggle to get a quote as new business. Two of Ireland’s bigger insurers, Aviva and Allianz, announced recently that they are not quoting new business for older cars which is a symptom of a bigger problem (although there are still options, including AA, for those with 15 year old cars).
There are a few reasons why this is happening, some valid and some frustrating. Firstly there is more traffic out there. Last year AA Roadwatch warned of the busiest traffic season in years and so it proved. More traffic means more exposure and hence, more collisions. More worryingly, though, the cost of settling those claims is going up. Personal injury awards are increasing and so are legal costs.
There is also an element of correction going on for previous under-pricing. It is no consolation now, but Irish motorists were collectively getting insurance at a price that was below cost for a few years. That was never sustainable.
Another big reason is fraud which we have estimated adds about €40-€50 to the cost of every policy in the country. While we have had fraud in good times and bad it is particularly frustrating now as prices go up. We can ill afford the increase in the cost of living and we certainly can’t afford to pay good money in order to pay for the cost of chancers and fraudsters.
The AA wants the government to take the whole area of fraud much more seriously and we have a number of proposals to tackle aspects of it. No doubt, there will be much more on that in the coming months.
In the meantime, we are still doing our best to provide insurance at the best prices. If you need insurance please include us when you shop around.