Number seeking last-resort help for car insurance dips to 1,147

Three motorists seek last-resort help every day in Ireland after being repeatedly turned down for car insurance, latest figures show.

Last year, 1,147 drivers refused cover by three or more insurers applied for a quote under the Declined Cases Agreement, which compels companies to offer a quote on the fourth attempt unless it is against the public interest.

Insurance Ireland, the industry representative body under investigation by the European Commission over whether there is a cartel among insurers, operates the scheme.

The figures are regarded as the most reliable indication of how regularly insurers are refusing to provide quotes, as the firms themselves do not provide figures.

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Although the scale of the problem has declined since a peak in 2016 when the insurance industry came under much scrutiny, the number of drivers seeking last-resort cover remains 10 times what it was a decade ago.

Conor Faughnan, director of consumer affairs for the AA, said it shows the problem is not being resolved. "It has got a tiny bit less acute, and has become normalised," he said. "But it is still a broken system or at least a system with expensive fault lines in it."

Returning emigrants

Mr Faughnan said returning emigrants are among those who feel most "hard done by" in getting refused insurance quotes or being offered prohibitively high premiums.

“If you are coming back from the United States or Australia, for example, it is less straightforward than if you are coming back from the UK,” he said.

“On the insurance company side, [applications] may be done algorithmically and unsympathetically. If your proof of no claims and and insurance history is from a more remote country with which the company has less of a connection, they just don’t have anything like the same clarity as with Irish records.

Others often refused insurance include motorists with excessive penalty points or unusual cases that may be seen as too risky, he added.

Michael McGrath, Fianna Fáil finance spokesman, said the data did not show how many people were in a position to take out their insurance as a result of invoking this arrangement.

“I suspect in a great many cases the resulting quote was prohibitive and the person was unable in effect to obtain motor insurance they could afford,” he said.

“Invoking the Declined Cases Agreement is very much the last resort for someone unable to even get a quote in the market. I think it underlines the fact that insurance companies have become more risk averse in the current market.

Minster for Finance Paschal Donohoe provided the figures in response to a parliamentary question.

Last month, the European Commission opened a formal investigation into insurers in Ireland over allegations of anti-competitive practices and the restriction of access by some companies to a claims database. The inquiry comes almost two years after it raided Insurance Ireland.

Separately, the Competition and Consumer Protection Commission is in the latter stages of its own investigation into whether motor insurers and brokers have been engaged in anti-competitive practices.

Year Number of cases

2018 1,147

2017 1,423

2016 1,941

2015 1,164

2014 669

2013 308

2012 178

2011 169

2010 130

2009 115

Source: Insurance Ireland