Insurance Prices Rising Sharply
An analysis of motor insurance prices across the market carried out on behalf of the AA has revealed what many Irish motorists are finding out already – insurance prices are going up. This is a major disappointment for motorists even if it is not a surprise. The cost of motor insurance has fallen significantly each year for the last five years. Now it is rising again.
The falls in motor insurance over recent years can be traced back to reforms in claims costs and legal expenses which came about as the Personal Injuries Assessment Board was established in July 2004. Improving road safety also helped.
The cost of claims is now rising again. Medical costs have increased and there is a rise in the frequency of material damage claims. Added to this inevitably is the global economic context and the loss to the major international insurers and reinsurers of the investment income that was made in recent years. The practical effect here in Ireland is that premiums are going up, right across the board, and this will affect the cost of living for 2 million Irish motorists.
It is important that consumers should exert pressure on insurance companies to compete on price. Be warned, though, that shopping around should also mean scrutinising the extra benefits and not just the price. Best price may not mean best value, so read the small print particularly with respect to important features such as protected No Claims Discount.
AA estimates on the average change in motor insurance premia from 2003 to 2009
- 2003 increase 10%
- 2004 decrease 22%
- 2005 decrease 13%
- 2006 decrease 13.5%
- 2007 decrease 9%
- 2008 decrease 8%
- 2009 increase 10% (estimated)
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