Written answers

Wednesday, 27 June 2018

Photo of Tom NevilleTom Neville (Limerick County, Fine Gael)
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113. To ask the Minister for Finance his views on a matter (details supplied) regarding camper van insurance; and if he will make a statement on the matter. [28150/18]

Photo of Paschal DonohoePaschal Donohoe (Dublin Central, Fine Gael)
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As Minister for Finance, I am responsible for the development of the legal framework governing financial regulation.  Neither I nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products, as these matters are of a commercial nature, and are determined by insurance companies based on an assessment of the risks they are willing to accept.  This position is reinforced by the EU framework for insurance which expressly prohibits Member States from adopting rules which require insurance companies to obtain prior approval of the pricing or terms and conditions of insurance products.  Consequently, I am not in a position to direct insurance companies as to the pricing level or terms or conditions that they should apply in respect of particular categories of drivers or vehicles. 

In making their individual decisions on whether to offer cover and what terms to apply, insurers will use a combination of rating factors, which include how the vehicle is used and the type of vehicle, as well as the age of the vehicle, the age of the driver, the relevant claims record and driving experience, and the number of drivers.  My understanding is that insurers do not all use the same combination of rating factors, and as a result prices and availability of cover varies across the market.  In addition, insurance companies will price in accordance with their own past claims experience, meaning that in relation to particular categories, different insurance companies will have different views.

However, it is acknowledged that pricing in the motor insurance sector has been subject to a lot of volatility in recent years, and this was the main impetus for the establishment of the Cost of Insurance Working Group.  Its Report on the Cost of Motor Insurance was published in January 2017.  The Report makes 33 recommendations with 71 associated actions to be carried out in agreed timeframes, set out within an Action Plan.

Work is ongoing on the implementation of the recommendations by the relevant Government Departments and Agencies and there is a commitment within the Report that the Working Group will prepare quarterly updates on its progress.  The fifth such update was published on 11 May and shows that of the 50 separate deadlines set to date within the Action Plan, 40 have been met.  Substantial work has also been undertaken in respect of the nine action points categorised as “ongoing”.  Both the Report and the quarterly updates are available on the Department’s website, within “The Cost of Insurance Working Group” sub-section of the main “Insurance” section.

It should be noted that the most recent CSO data (for May 2018) indicates that private motor insurance premiums have decreased by 19% since peaking in July 2016.  While the CSO statistics indicate a greater degree of stability on an overall basis, these figures represent a broad average and therefore I appreciate many people may still be seeing increases.  However, I am hopeful that the improved stability in pricing will be maintained and that premiums should continue to fall from the very high levels of mid-2016.  In addition, with the full implementation of the Motor Report, I believe that Ireland should be more attractive to new entrants thus increasing capacity as well as competition which should have a positive impact in niche areas such as motor insurance for camper vans and musicians. 

Finally, as the Deputy may be aware, if a consumer is unable to secure a quotation on the open market, he or she may be in a position to avail of the Declined Cases Agreement (DCA) process.  Under the terms of the DCA, which is adhered to by all motor insurers in Ireland, the insurance market will not refuse to provide insurance to an individual seeking insurance if the person has approached at least three insurers and has not been able to obtain cover from them.  In this regard, there are further details available on the Insurance Ireland website, while more generally, Insurance Ireland also operates a free Insurance Information Service for those who have queries, complaints or difficulties in relation to obtaining insurance.  The relevant contact details are: feedback@insuranceireland.eu or declined@insuranceireland.eu or 01-6761914.

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