Thursday, 5 March 2020
Department of Finance
Motor Insurance Costs
65. To ask the Minister for Finance if his attention has been drawn to the fact that certain taxi drivers are receiving insurance quotations for their vehicle that are more than double the quotations being received from other insurance providers; the reason such a large discrepancy can exist; and if he will make a statement on the matter. [2564/20]
At the outset the Deputy should note that neither I, as Minister for Finance, nor the Central Bank of Ireland can interfere in the provision or pricing of insurance products or have the power to direct insurance companies to provide cover to specific individuals or businesses. This position is reinforced by the EU framework for insurance (the Solvency II Directive) which expressly prohibits Member States from doing so.
Having said that, in terms of the insurance market and pricing, my Department has been previously advised that insurers, in making their individual decisions on whether to offer cover and what terms to apply, will use a combination of rating factors, which include the age of the vehicle, as well as the type of vehicle, the age of the driver, the relevant driving experience, the claims record, the number of drivers, the requirement to use telematics technology, and how the car is used. 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, insurers will price in accordance with their own past claims experience overall.
In the case of taxi drivers, I understand that insurers take into account the nature of the taxi business, which involves driving for hire or reward extensively and in their view this has a much higher risk of injury claims from passengers and other road-users as a result.
It should also be noted that the number of taxi and hackney drivers utilising the Insurance Ireland Declined Cases Agreement fell from 375 in 2016 to 205 in 2019, which suggests increased stability in the market and greater availability of insurance for drivers.
Finally, this particular price differential highlighted by the Deputy reinforces the importance of businesses and consumers shopping around for the best value insurance product.