Insurance companies are putting rates through the roof.
Deputy Pearse Doherty has said it is time for a more honest debate on why motor insurance premiums are rising.
The Sinn Fein politician also demanded an end to the one sided “bogeyman” attacks on claimants and their legal representatives as being solely responsible.
The Donegal TD pointed to the insurance companies’ own records and Central Bank correspondence showing that their investment strategies are also a factor in the dramatic increases.
Deputy Doherty said the dramatic increase in motor insurance over the last year has been a major setback to many families, especially young people and rural communities.
He said “Correspondence I have received from the Central Bank and replies to parliamentary questions point to another factor too – the companies’ own investment policy faring significantly worse off in an era of low interest rates.
“Unfortunately the debate so far has been dominated by the industry narrative that higher claims and other factors caused by the customer base, like fraud, are solely to blame for the rises. Those factors and the legal structures in place do undoubtedly contribute to the recent increases but it is time for some honesty so the full picture can be seen. The “bogeyman” tactic of blaming only fraudsters or the Courts or the legal profession should end.
“I will immediately seek that a new Oireachtas Finance Committee look at all the reasons people with no record of claiming have been hit with 100% or even higher increases in their premium. It is simply not credible based on the evidence we have that the massive increases are down solely to the factors outlined by the industry.”
He added it may be that in the past the rates charged for motor insurance in Ireland were unsustainably low and that we are entering an era of higher rates.
“If that is the case the regulatory environment that allowed an unsustainable industry to operate on such an unstable basis needs to be examined closely.
“The industry has also listed a number of factors from higher claims to the impact of Court decisions in the Setanta case or draft legislation on periodic payments as the causes of higher premiums for drivers. There are legislative and regulatory steps that could be looked at to counter these pressures but the factors unrelated to what any Court or any driver in Ireland has done or not done also need to honestly appraised.
“We have seen in recent years the collapse of two insurance companies in the State for which the consumer is paying or likely to be paying for. We cannot simply accept the industry narrative that all is fine if we just tinker with the awards system or review the Injuries Board’s Book of Quantum. That way is the way to disaster down the road as we know all too well. We cannot be afraid to look at the deeper issues brining about these skyrocketing charges.”
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