Car insurance premiums to fall in the ‘near future’
The chief executive of Insurance Ireland has said she would be “optimistic” that consumers will start to see a reduction in their motor insurance premiums “in the near future”.
However, Moyagh Murdock said it will take some time for the actual full benefit to be seen on all policies following judicial review guidelines.
Ms Murdock said there are a body of claims in the system already and premiums were priced on that basis in the past.
It will take some time “to see the actual cases flush through the system” to see all cases dealt with on the same terms, she added.
She said premiums have been coming down for the past 18 months to two years, with a reduction of 9% on premiums up to the year ending 2019 and in 2020 there was a further reduction of 6.5% which she said is continuing this year.
When there is certainty on the quantum of award that an injury will attract, this “should reduce the need for litigation,” she added.
The Insurance Ireland CEO said the main insurers passed on €56m in refunds in 2020 and while there was a large reduction in traffic volumes during the first lockdown, that was not the case in the subsequent lockdowns.
She said that traffic volumes have not been down in comparison to the first lockdown.
The Government recently sought firm commitments from insurance companies that they will reduce premiums following the publication of new personal injuries guidelines.
Minister of State for Insurance Reform Seán Fleming wrote to the CEOs of various companies seeking those assurances.
Labour spokesperson on Finance Ged Nash today welcomed the news that motor insurance costs are likely to come down after a landmark move to approve guidelines that will lead to a cut in personal injury awards.
“Finally we are set to see a change to the payouts associated with personal injury claims which will benefit us all through lowered insurance premiums and costs,” Mr Nash said.
“This is great news for customers throughout the country, as this, coupled with the decreased traffic on the roads means that customers should expect greatly reduced rates,” he added.
But Mr Nash questioned how it can take another two months for the changes to come into effect in an industry that we know has calculations on every possible outcome at its fingertips.
“The Minister needs to take control and press the industry to lower insurance costs for loyal customers now, not in a few months. The price reduction must also take account of our new reality,” he stated.