EU accepts Insurance Ireland commitments and closes cartel investigation

Industry group commits to giving outside companies fair access to a claims database it administers

The European Commission has accepted an offer from Insurance Ireland to provide non-members with clear and fair criteria to access an insurance claims database, drawing a line under a five-year cartel investigation.

In its preliminary view in June last year, the commission said the industry group had arbitrarily delayed or, in practice, denied access by non-members to Insurance Link, a claims information exchange it administers.

Insurance Ireland subsequently submitted concessions to the EU competition watchdog, which went on to seek feedback from rivals and users. Members of Insurance Ireland cover 90 per cent of the Irish motor vehicle insurance market.

“The commission found that Insurance Ireland’s final commitments will ensure market participants’ access to the Insurance Link platform, and decided to make them legally binding on Insurance Ireland,” the European Commission said in a statement on Thursday.

The concessions include allowing non-members to access Insurance Link, adopting fair and non-discriminatory access criteria for all applicants from Ireland and other EU countries, it said. Insurance Ireland also promised to provide clear application procedures for membership of the organisation.

“In light of concerns raised during the investigation, Insurance Ireland offered a set of commitments to allay the concerns,” Insurance Ireland said. “The offer of the commitments is not an acknowledgment that Insurance Ireland has infringed competition law, and Insurance Ireland notes that the European Commission has not found that Insurance Ireland has infringed competition law.”

Insurance Ireland’s chief executive, Moyagh Murdock, welcomed the conclusion of the investigation, saying her organisation “co-operated fully and worked constructively with the European Commission” throughout the process.

Three inquiries

The case was the last of three competition investigations that had been hanging over the Irish insurance industry in recent years.

The commission opened a formal investigation three years ago into whether Insurance Ireland was operating a cartel by restricting access to the claims database, almost two years after it raided the group as part of an inquiry into a number of issues in the sector.

European competition enforcers were also at that time, in 2017, looking into concerns of anticompetitive practices in the market for insuring trucks and lorries in the Republic. However, it dropped that investigation in 2019.

Meanwhile, a five-year Competition and Consumer Protection Commission (CCPC) investigation into allegations of insurers signalling motor premium price increases to each other ended last August with five insurers and AA Ireland, an insurance intermediary, committing to legally binding agreements to reform their internal competition compliance. None of them conceded that they had breached laws.

Price signalling occurs when businesses make their competitors aware that they intend to increase prices.

The end of the latest investigation on Thursday came a day ahead of the implementation of a Central Bank of Ireland ban on a widespread practice of “price walking”, where motor and home insurers increase premiums for loyal customers by stealth. It means that insurers, as of July 1st, cannot charge personal consumers who are on their second or subsequent renewal a premium that is higher than what they would have charged them if they were on their first renewal.

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times