Value of motor insurance premiums fell 10% in 2004

The value of motor insurance business fell in 2004 for the first time in recent years as insurance companies suffered the impact of increased competition and a decline in premiums, according to the annual report of the Irish Insurance Federation (IIF).

The value of motor insurance premiums written fell by 10 per cent to €1.7 billion. Overall, non-life insurance business was down 5.6 per cent to just over €4 billion.

However, IIF president Paul Donaldson said the reduced premium value was counterbalanced by improved operating conditions and fewer claims.

The life market enjoyed better fortunes, with an increase of 7.5 per cent in new business sales on the previous year.

Motor insurance was again the main subject of complaints and queries to the IIF's information service last year. Out of 1,233 registered complaints, 1,084 - 88 per cent - were in respect of non-life insurance. Life complaints accounted for 149 or 12 per cent of the total number of complaints.

The most common topics for life complaints and queries were surrender values, allegations of mis-selling, claims settlements and the performance of endowment mortgage policies.

Meanwhile, 832 new cases of suspected insurance fraud were reported by members of the public to the IIF's insurance confidential hotline. Some 511 of these cases related to motor insurance.

More than 100 cases have been referred by insurers to the Garda Bureau of Fraud Investigation.

Insurance companies have consistently confirmed that there has been a reduction in the number of fraudulent claims made, according to the IIF's chief executive Michael Kemp.

The IIF called for the roles of financial regulator Ifsra and the Department of Finance to be clarified.

"Ifsra clearly has an important input into formation of overall supervisory policy. However, ultimate political accountability rests with the Minister and Department of Finance," said Mr Donaldson.