THE EUROPEAN COMMISSION has opened a formal investigation into Insurance Ireland’s data pooling system.

The investigation will assess whether the association is operating a cartel with the conditions of access to its data pooling system. The Commission will look at whether these conditions restrict competition, which would be a breach of EU rules.

“Insurance is essential for all car drivers in Europe,” said Commissioner Margrethe Vestager today.

“We are investigating whether companies wishing to offer their services on the Irish motor insurance market may have been unfairly prevented from accessing a data pool managed by Insurance Ireland for its member companies.

“This could potentially reduce Irish drivers’ choice of motor insurance policies at competitive prices.”

The launch of this anti-trust investigation follows inspections carried out in July 2017 in the Irish motor insurance market. Antitrust investigations are designed to assess whether agreements of decisions of associations are anti-competitive.

‘Effective competition’

Insurance Ireland is an association that brings together a number of insurance firms in Ireland. It manages a database called InsuranceLink which contains information provided by member companies about insurance claims.

The Commission said the stated purpose of the system is to facilitate the detection of potentially fraudulent behaviour by claimants and to ensure the accuracy of information provided by potential customers to insurance companies and/or their agents.

“The Commission does not question that data pooling arrangements can contribute to effective competition. The participation in and access to a data pool by insurance service providers may directly benefit consumers in terms of ensuring more suitable products and competitive prices.”

The investigation will assess whether the conditions imposed on companies wishing to access this database may have put these companies at a competitive disadvantage on the Irish motor insurance market in comparison to companies that already have access to it.

If proven, the practices may breach EU competition rules which prohibit agreements between companies that prevent, restrict or distort competition within the EU single market.

Insurance Ireland has noted the decision to open a formal investigation and said it is important to note that the commission has not reached any conclusions or made any findings. 

“Insurance Ireland understands that the investigation is focused on the InsuranceLink database, which is a secure database that holds claims information as a tool to assist in fraud detection. InsuranceLink is accessed by Insurance Ireland members and non-members and has been in operation since 1988,” it said in a statement.

“Insurance Ireland is cooperating fully with the European Commission in its enquiries and is confident its practices are fully compliant with competition law.”