INSURANCE PROVIDERS MUST now provide customers with information on premiums paid for private motor insurance renewals for the previous year.
Under new Central Bank rules coming into effect today, motor insurers also have to provide a quotation for each policy option available to customers in relation to comprehensive, third-party fire and theft cover or third-party only cover.
The new rules – which the Irish Central Bank says will provide greater transparency and help people make a “more informed decision” when purchasing insurance – means that details of premiums paid the previous year must be displayed “prominently” on the same page as the renewal premium.
Fianna Fáil TD Michael McGrath has said that although the new rules are “welcome” they “should have happened a long time ago”.
Said McGrath: “These changes come nowhere close to what is needed to tackle the insurance crisis.
“The government either doesn’t realise the scale of the insurance crisis facing consumers and businesses or it doesn’t care.”
The new rules also mean that insurers now have to extend their renewal notification period from 15 to 20 working days for motor, health, damage to property and general liability insurance.
This, the Central Bank has said, is to allow policyholders more time to find comparison quotes.
The new rules “will help consumers make better informed decisions when shopping around for their insurance policies,” Director of Consumer Protection Gráinne McEvoy said.
“Motor insurance in particular can represent a significant outlay for many people, so these changes will help people to shop around and make informed choices.
“We are insisting that insurers put the price comparison on the same page of any renewal notice. This makes it easy for customers to see if their premium has increased. We expect the insurance sector to embrace these rules, in the best interest of their customers. And the Central Bank will closely monitor their compliance,” said McEvoy.
‘Database’
The rules follow on from the government’s 2016 Cost of Insurance Working Group which examined the costs behind motor insurance in Ireland.
The January 2017 Cost of Motor Insurance Report also recommended establishing a National Claims Information Database (NCID) to allow for an in-depth analysis of annual trends in car insurance claims.
In July, however, the government was critcised for not giving a specific date for the set up of this database that would map trends of motor insurance claims.
The Central Bank told TheJournal.ie that the claims database has been established and that it plans to publish its first report based on the data collected by the end of the year.
In July, the Department of Finance said that the database would include details such as where claims are settled and the various costs associated with the claims process, but said that it wouldn’t aggregate the data on a claim-by-claim basis as there would be “major data protection implications” including GDPR issues, among other problems.
The Department of Finance said that it was seen as “key to developing an understanding of how claims costs are impacting premiums”, adding that the Central Bank is to begin collecting the required data from insurers and to publish its report later this year.
That same week, Sinn Féin TD Pearse Doherty made headlines after questioning representatives from the insurance industry who appeared in front of the Oireachtas Finance Committee about their claim that 20% of insurance claims were suspected of fraud.
Doherty at the time questioned what proportion of these claims were reported to Gardaí, to which representatives replied only a fraction. Doherty surmised that the number of fraudulent claims was closer to 1% rather than 20%.
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