Ask A Broadsheet Reader

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Alan O’Regan asks:

Anyone know what car insurance has gone up so much since last year? Between 30 and 50%! The best answer I could get when I rang around is “that’s the nature of the game”. 2002 car that I use as a run round. Passes its NCT every year. 7 years no claims. No points. Some of the quotes I got made my eyes water…

Anyone?

If you have a problem, if no one else can help, and if you can withstand mild, sociopathic ribbing….maybe you can ask a Broadsheet reader.

(Queries to: broadsheet@broadsheet.ie)

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37 thoughts on “Ask A Broadsheet Reader”

  1. Jonsmoke

    Ah come on! Are you really looking for an answer here for this? This topic has been all over the radio and newspapers for months.
    It is simple. The insurance companies don’t have enough money to cover the rising number of claims so they are increasing premiums. It is nothing to do with you, your car or your previous claims. You are paying for other people’s bad driving and/or lack of insurance.

    1. dan

      that’s not really true Jon. What’s happening is that the companies are price fixing.
      And you are paying 2% levy for Sean Quinn’s lack of business acumen.

    2. Sheik Yahbouti

      Do you mean why? If that is your question then, 1. huge deficits in claims provision (much of which is attributable to Sean Quinn for undercutting every other Insurer unfairly). 2. Profits have fallen, not disappeared, but the shareholders must be placated at all times. 3. because successive Irish Governments have supported and ensured that Insurance companies can do whatever they like. 4. because there is no meaningful oversight or regulation. 5. because they’re b*st ards

  3. Junkface

    Its just the way Ireland works. Big insurance companies are involved with price fixing, so they get to charge whatever they like. The Government fails to properly regulate it all because they are getting a slice of the action too. Check out any Radio or TV station, which types of businesses bombard the airwaves insessantly? Insurance companies, they have a bottomless pit of cash for advertising, they are super rich, and they find many, many ways to not pay out on valid claims from long serving customers. Its a rigged game. Thats Ireland for ye

      1. Junkface

        But Ireland tops the international list of very. very expensive countries to get insured in. As usual. We’re always top of the class when it comes to getting ripped off

  4. Bruncvik

    It’s all a big conspiracy to make the Irish a nation of marathon runners. First, renters get priced out of the cities. Then they’ll be priced out of car ownership, get their bikes stolen and have Luas shut down on them. The only solution for them to get to work will be running. Before you know it, the Irish will give the Kenyans a run for their money.

  5. ivan

    Few factors, i’d guess

    a) lot (but not all) insurance companies are global, so even if domestic car insurance is doing OK, they still have to subsidise a bad year for shipping in, say, France
    b) greed
    c) there’d be a bit in the ‘bogus claims’ thing but not as much as they’d have you think
    d) greed
    e) under provisioning. As I understand it, when a claim comes in, a company is meant to actually ringfence money that potentially might have to go out to cover such a claim. I think that this wasn’t done for quite some time, so now that some claims are maturing, the money ain’t there, because it was never set aside and the easiest way to recoup it quickly? Yup.

    What Jonsmoke says above is largely true though – it’s getting to be less and less about the likelihood of you having an accident that governs your premium any more….

  6. Gers

    This will tell you what you need to know:

    https://www.quoteme.ie/blog/increasing-premiums-for-car-insurance/

    in Summary:

    1. The increasing number of claims being made especially for minor soft tissue injury.
    2. The cost of these claims are increasing, Aviva estimate claims inflation at 10%.
    3. Rise in fraudulent claims which can be difficult to quantify as they range from exaggerated claims to the organised staging of accidents.
    4. Changes and increases to court jurisdictions.
    5. Legislation introduced in August ’14, Recovery of Benefits and Assistance which recovers certain illness-related social welfare payments.
    6. Reduction in the Discount Rate which really only effects the largest claims and because of falling interest rates more needs to be awarded to ensure the injured person to support themselves.
    7. Introduction of Periodic Payments Orders which again will probably only impact the largest claims but again imposes uncertain future costs on Insurers which must be provided for.
    8. There is increased engagement by Solicitors in motor accidents claims, for example 40% of claims assessed by PIAB are appealed.

    1. They Tried To Make Me Go To Rehab

      What is the source for these claims and where can they be peer-review and/or independently verified?

      1. Kolmo

        I saw about 4 months ago on Primetime that there was no empirical evidence to back-up what the insurance companies are claiming to justify hikes in premiums, an insurance industry spokesman was there blaming people for claiming, blaming the legal industry, and medical inflation, this is repeated again and again since – as far as I remember all the claims were shot down by the presenter and the other guest, from an insurance watchdog/group..I’ll try to find a link

        My insurance is creeping up to the price I paid when I was 18, (20 years ago), no claims or points etc..just bend over, we ain’t even buying you dinner.

      2. rotide

        Insurance companies PR statements don’t get ‘peer reviewed’. They aren’t announcing cold fusion.

  7. Mike

    Because the financial ombudsman has started to do it’s job for a change and has asked some awkward questions to the insurance companies. Now the insurance companies have to charge inflated prices to customers to get their reserves up to a legal minimum level after years of over inflating profit reports to boost their share price, allegedly.

  8. dav

    daddy quinn and his bad bets have some part to blame, but in the main it’s as usual, an unregulated financial service screwing the irish people as those in power wring their hands and suckle the teat of “market forces”

  9. Donger

    So I keep hearing but mine has actually come down. Very similar to yourself-03 car, never failed nct and 7 years no claim. 3rd party f&t insurance was €330 last month, down from €350

  11. Murph Mikey

    This is waffle from the insurance companies. Every year they throw this out there and expect people to just cough up the money. Not me…my insurance has come down every year since i started driving in 2002. Paying about 600euro for me and the wife on the family MPV. You have to put time into getting a renewal. Dont just accept the first letter you get. You have to get about 7 or 8 online quotes… I went on line and was getting quotes around 850 up to 1100 euros. Got AA quote for 636 and now, im ready to haggle with current insurer. Its easy, you need to put time in and people dont do that….

    2. jonjo

      agree – some of them are charging mad money… you have to ring round…(then ring again in a different voice as the ad goes)
      anyway, got meself and the missus insured on 2013 mpv fully comp – ended up using aaran insurance – brokers … final policy was through someone i never heard of before (and so cant rem the name…”water” was in the name… prob uk based)

  13. LW

    Mine was hiked 200%, no budge from the company, no claims or anything. I suspect the age of your car is what’s being blamed

  14. collynomial

    There is a lot being written here which seems not to have been backed up by anything. It all hinges on how insurance works and a recent case at the high court.

    The following is key: Insurance is the pooling of risk, the risk of an individual is the likelihood of an accident multiplied by the cost of the accident. The premium a customer would pay in a perfect scenario would be exactly the amount of risk they would be liable for. this is why insurance companies charge different premiums based on different risk types: young drivers paying more than older more experienced drivers and until recently male drivers paying more than female drivers.

    Why is this a “perfect scenario”?
    Because of what happens in the case that you are in an accident caused by an uninsured driver. It is a legal requirement to have motor insurance if you want to drive your car in a public place. But if someone breaks the law and causes and accident, the cost of that accident is borne by the Motor Insurance Bureau of Ireland.

    The Motor Insurers’ Bureau of Ireland (MIBI) is a non-profit-making organisation registered in Ireland. The company was established in 1955 by Agreement between the Government and those companies underwriting motor insurance in Ireland. The first Agreement was signed in 1955 with subsequent Agreements in 1964, 1988, 2004 and 2009.

    All insurance companies underwriting motor insurance in Ireland must, by law, be members of MIBI and contribute to funding for claims in proportion to their market share.

    In 2014 the Maltese registered (and hence regulated) Setanta Insurance went into liquidation, it had aggressively undercut its competitors by offering premiums that were lower than the market rate, in retrospect, by under funding the risk that each driver faced. It took on riskier drivers for premiums which were less than their risk. When they went under many drivers were left uninsured.

    In late 2015 the High Court ruled that the MIBI was liable to pay out in respect of claims against persons who were insured with Setanta at the time of its entry into liquidation.

    The MIBI decided to appeal to the supreme court, but if the Supreme court does not rule in its favour this leaves MIBI members on the hook for all drivers in all insurance companies in the case that those insurance companies (not necessarily even regulated in the state) go into liquidation.

    That is to say, if Aviva were to rule that Joe Bloggs was too risky to insure and not offer him a quote, ACME Insurance PLC registered in Cyprus could insure him for €10 a month and go into liquidation as soon as a claim came their way, meaning Aviva would have to pay for the accident via their contributions to the MIBI.

    This is a huge market distortion, and makes it so that the “perfect scenario” is not a credible one, the insurers have no choice but to pass on the additional risk to their customers via premiums. Each customer therefore pays not only for themselves, but also for all customers of all other insurance companies.

    1. Anne

      +
      http://www.irishexaminer.com/business/failed-insurance-companies-rack-up-14bn-bill-395239.html

      Some questions arise, like –
      Why were they registered in Malta?
      (I read on boards.ie from 2010 well before they became insolvent that someone was waiting 9 months for a claim to come through.. dodgy )
      What were the directors’ salaries?
      Where’d the money go?
      http://www.sinnfein.ie/contents/30554

      All Insurance operating in Ireland, selling to Irish consumers should be regulated by the Central Bank of Ireland in my opinion.

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