According to the latest figures from the Central Statistics Office the cost of car insurance was on average 38.6% higher in July 2016 when compared to the same period one year earlier.
While rising legal fees and an increase in the number of claims have played a role in this increase, these have been long standing issues within the Irish market and therefore don’t fully explain an increase of almost 40% in one year.
Instead the increase in prices can be largely viewed as a factor of a failure to properly regulate conditions within the Irish insurance market. This lack of regulation has resulted in a decreasing competition within the Irish market, with only 5 or 6 genuinely active competitors in the Irish insurance market with some of these now retreating.
This signals a fundamental issue within the Irish market as despite rising premiums and an increase in the number of cars on the road, the level of competition is diminishing due to the unhealthy state of the market.
Conor Faughnan, AA Director of Consumer Affairs, appeared on RTÉ News at One to discuss the reasons for these increases further. Listen to the full clip here.