Bad news for the motor insurance industry but good news for Irish consumers – the Competition and Consumer Protection Commission (CCPC) is to launch a probe into “suspected breaches of competition law in the motor insurance sector”, having issued summonses to witnesses and information requests to the major players within the insurance market, as well as industry groups who represent insurers and brokers.
The investigation will examine if public pronouncements of future motor premium increases amount to a breach of competition law within the motor insurance sector.
“Markets work best where businesses vigorously and independently compete against each other for customers. Statements signalling future pricing predictions or intentions may result in a degree of unspoken coordination, which may breach competition law,” said Isolde Goggin, Chairperson, CCPC. “Statements by senior industry players have raised serious suspicion as to whether there is a link between these messages and subsequent price increases. The evidence collected through both the witness summonses and the information requests will assist us in establishing whether there has been a breach of competition law.”
Further pressure will undoubtedly be brought bear on the industry from the Oireachtas Joint Committee on Finance, which has been tasked with examining the spiralling insurance prices. The Irish Times notes that on Wednesday, Stephen Watkins, director of corporate services with the Injuries Board, told the committee that awards made over the past six or seven years were “stable”. Thejournal.ie quotes Injuries Board CEO Conor O’Brien as saying at the meeting that “In relation to claims, it’s not entirely clear how claims are contributing to this issue,” and that recent figures “do not support the level of increase in claims and we cannot see how people justify the level of increases that we’ve seen.”
For motorists under pressure to pay the dramatically increasing insurance premiums, such moves are welcome, and long-awaited.
“The CCPC has been monitoring the motor industry and we know from our contacts with consumers that the sharp rise in motor insurance premiums has had a significant impact on them,” said Isolde Goggin. “We continue to closely monitor developments and will, if necessary, take action to stop specific anti-competitive practices in the motor insurance sector. If anyone believes they have evidence of a breach of competition law in the motor insurance sector, we would ask them to contact the CCPC.”