A FOREIGN NATIONAL quoted over €17,000 for taxi insurance for a year, was asked to pay nearly €5,000 upfront to keep his car on the road.
The issue of higher taxi insurance comes against the wider backdrop of much higher premiums in recent times, with the government’s working group aiming to tackle these high costs facing difficulties in bringing them down so far
Faced with a choice between not working or paying the insurance, the Dublin-based man said it left him with little option but to pay up the deposit so he could stay on the road.
His situation is one common to a number of taxi drivers looking to get insured on Irish roads, who face difficulty in affording to do so.
The man was involved in one collision on Irish roads in the past three years, although it was not while driving his taxi.
“The car is only worth €20,000,” the taxi driver told TheJournal.ie. “I had a claim against me, after a guy said he had neck pain after an accident with the car. The cost of repairing the car was only a few hundred euro.
I’m in stress now today because I have to pay them that deposit. I don’t have a choice or my car would not be fully covered.
Taxi drivers we spoke to after fare increases last year also cited insurance as a cause of complaint. One said: “My insurance went through the roof this year, with no real reason given. It’d put you off getting into this game.”
The figure drivers are quoted however, can range vastly. Another driver we spoke to, with a 10-year-old car, and nine years’ experience as a taxi driver was recently quoted €2,300 to renew his insurance.
Another, with a newer car but with much fewer years in the job, was quoted €4,500.
Jim Waldron, spokesperson from the National Private Hire and Taxi Association, told TheJournal.ie that he’s heard of costs over €10,000 for new people coming into the business, but that it wouldn’t always be the case.
Even for those not paying such costs in this bracket, many taxi drivers are still feeling the pinch in recent years, according to Waldron.
He also said that a company acquiring a number of taxi licence plates in one go is often better placed than an individual to source reasonably-priced insurance, with the individual usually facing a higher premium.
“Overall, the last three years has seen insurance go up year-on-year to about 35% higher,” he said. “As an association, we’ve been trying to bring the cost of insurance down by bringing in more competition, and there are talks going on there.
Someone going in with 50 plates could get a more favourable insurance policy where an individual driver has been crucified for the last few years… It’s a business cost, but there’s only so many hours in a day that a taxi driver can work. The last thing we’d want people to be doing is to work morning, noon and night, and then have to hand what they’ve earned over to the insurance company.
High costs, dwindling numbers
The number of taxis in Ireland has already dropped dramatically in recent years, with the high cost of insurance often cited as a deterrent.
From a high of 47,222 drivers with valid licences in 2009, there were just 26,012 licences last year.
In all, there were 400 less taxi drivers on the streets in 2017 compared to the previous year. The majority of drivers (54%) hold a Dublin licence entitlement.
Earlier this year, the National Transport Authority launched a campaign aimed at recruiting 1,600 taxi drivers.
Its CEO Anne Graham said while having 26,000 drivers licenced “might sound like a lot, but they are not all available all of the time, which means there can be shortages at certain period particularly at peak hours and weekend nights”.
According to NTA research from 2016, the average metered revenue per week for a taxi driver in Dublin was €635, with the high end stretching up to €1,189.
The question of the cost of insurance has been raised in the Oireachtas a number of times in the past year, as the government aims to arrest the cost of car insurance which has skyrocketed in recent years.
In 2015 alone, more than a third of Irish drivers saw their insurance rise by up to 50% – a situation that descended into something of a blame game between insurers and the legal profession
Work has been done to rectify the problem however, starting with the publication of a fresh Book of Quantum in 2016, the first in 12 years, which officially crystallised the level of claims being seen in Ireland.
Furthermore, a recently published report from the Personal Injuries Commission has highlighted the “stark multiples” of compensation payouts in Ireland compared to our European counterparts.
Insurers say it is these payouts that lead to higher premiums, and the report says that taking appropriate action now would help to achieve a “greater level of consistency in Ireland in the assessment of general damages”.
Waldron added that when a taxi driver has had an accident, it can be very difficult to avoid facing a spike in the cost of insurance.
“Absolutely, it shoots up,” he said. “I can understand why it would be that someone would be quoted as high as €17,000 if there’d been a claim. It’s very hard to switch insurers then too because the first thing they ask you on the form is ‘have you had an accident?’.”
Speaking at a Dáil debate last month, Independent TD for Dublin Bay North Tommy Broughan said that every deputy has been contacted “time and again by all kinds of hard-pressed constituents”.
“We have also been contacted by distressed taxi drivers, who are in the public transport mould,” he said. “Due to changes in their training and so on, they have had to come up with vast sums of money.”
‘That is insane’
Newer drivers driving their own vehicle, in particular, face higher costs.
Senator Jennifer Murnane O’Connor told the Seanad in June: “Many of us have stories of our own or have heard stories about the rising cost of insurance.
This week, I heard about a taxi driver who had been driving as a named driver on his company fleet insurance. He had his test and wanted to get a policy in his own name. He was quoted €11,000 in respect of a vehicle that is valued at €12,000. That is insane.
In a statement to TheJournal.ie, a spokesperson for industry group Insurance Ireland said it couldn’t comment on individual cases, but added that “insurers make decisions on insurance cover based on their underwriting criteria, their risk appetite and their claims history”.
“This will include factors such as the driver’s experience, the type of vehicle, its engine size and its age, but the weighting applied to each factor is a matter for each company,” it said.
Insurance Ireland pointed to the recent report from the Personal Injuries Commission which found that the average compensation issues for soft tissue injuries in Ireland is four times higher than in the UK.
“Insurance Ireland has been very active in advocating for policies to address the cost of claims in the market that affect all motorists and will continue to press for the swift implementation of the recommendations of the Personal Injuries Commission,” it added.
With reporting from Cianan Brennan
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