Written answers
Tuesday, 24 May 2011
Department of Enterprise, Trade and Innovation
Insurance Industry
6:00 pm
Peter Mathews (Dublin South, Fine Gael)
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Question 175: To ask the Minister for Enterprise, Trade and Innovation if competition law forbids insurance companies from forcing customers to use specific companies for motor repairs; and if he will make a statement on the matter. [12498/11]
Richard Bruton (Dublin North Central, Fine Gael)
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Determination of whether certain business practices breach competition law is ultimately a matter for the Courts to decide. I understand the arrangement referred to by the Deputy is one whereby insurance companies actively recommend certain approved repairers to their policyholders with the approved repairers selected on the basis that they meet various qualitative standards and, in return, are guaranteed a minimum flow of work. Service Level Agreements are generally entered into by the insurance company and the approved repairer. Nonetheless, policy-holders are free to select a repairer of their choice.
The Competition Authority, which is the independent statutory body responsible for enforcing competition law in the State, has previously advised my Department that such arrangements do not appear to breach competition law but, in fact, appear to result in a more cost effective service being provided to the general public. More recently, the Authority has conducted market enquiries with insurance companies on the matter and it appears to remain the policy of insurance companies to allow policy-holders to choose repairers.
However, if the Deputy is aware of any alleged anti-competitive behaviour by an insurance company, he should address his complaint to the Competition Authority who will consider each case on its merits. It is, of course, open to any aggrieved party alleging anti-competitive practices, including abuse of a dominant position, to take a private action under Section 14 of the Competition Act 2002.
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