Openess urged in insurance

Recommendations to increase transparency in the insurance sector are expected to form a key part of a report to be issued next week.

The final report by the Competition Authority on the sector is expected to concentrate on the availability of information to both insurers and consumers.

A preliminary report published by the authority last year identified what the authority said was a key barrier to market entry.

Underwriters need data in order to be able to price risk in a given market, and the availability of this information determined the number of suppliers, the authority said.

The Irish insurance sector shares information, but this data is not available outside the industry, raising costs for those who would like to enter the market, the authority concluded.

Recommendations on how to address this issue are expected to form a key part of the report, due to be published next week, covering the non-life insurance market.

The report is also expected to address issues to do with the better collection of information and the making available of more information to consumers wanting to buy insurance products.

The preliminary report published last year found that difficulties to do with the availability of information to insurers wanting to enter the market were aggravated by the late publication of information insurers are legally obliged to provide to the State.

This information, published by the Department of Enterprise, Trade and Employment in the so-called "blue book", gives a snapshot of a firm's financial position and ability to meet current and future claims.

While motor insurance is considered to have dropped in price in recent times, less progress has been made in relation to public liability insurance, an issue that affects business and community or voluntary groups.

The report is also expected to contain recommendations regarding the practices of intermediaries, or brokers, especially in relation to commission-based competition. The issue of transparency is expected to be addressed. The report's findings and recommendations are expected to concern a number of Government departments, regulators, and industry operators.

Since publication of the preliminary report, the authority has been in receipt of submissions from interested parties. Last week, the authority issued a report on competition in the legal sector, addressing issues to do with barristers and solicitors.