THE number of people killed and injured on the Republic's roads increased in 95, with 33 more deaths than in 1994 and 2,447 more people injured.
This fact was used by the Guardian PMPA insurance company to justify the announcement of a 5 per cent increase in motor insurance premiums. But there is not necessarily an automatic connection between an increase in the number of accidents and rising net insurance costs.
The National Roads Authority, from whose Road Accident Facts 1995 the figures are taken, comments: "Notwithstanding the increase in road deaths for 1995 the fatality rate per million vehicle kilometres of travel has improved significantly."
This improvement has taken place over a long number of years, when the accident trend has been downwards both in absolute terms and relative to the distances travelled. For example, in 1978 628 people were killed and 18,000 million kilometres travelled; in 1995 the number of kilometres travelled had almost doubled to 31,000 million, while the number of deaths had fallen to 437.
The number of cars on the road has increased steadily over the past 20 years. According to the Society of the Irish Motor Industry, there was a 31 per cent increase in new vehicle registrations in the nine months to this September. About half of this was due to the scrappage scheme introduced in the last Budget, according to Mr Cyril McHugh, of the SIMI.
The Revenue Commissioners said the number of cars registered increased from 80,203 in 1994 to 86,287 in 1995. But the increase this year 50 far has been much more dramatic. The number of cars registered in the first nine months alone of this year was 104,989, 18,702 more than for the whole of last year.
Cars cannot be registered without being insured, so this means that the number of cars insured, and therefore the income from insurance premiums, has increased by about 20 per cent this year.
Mr Michael Horan, of the Irish Insurance Federation, conceded there had been an increase in the number of cars insured. However, he said the increase in claims was the main reason for the rise in premiums. The number of claims in 1995 was 10 per cent up on 1994 he said.
While the decrease in accidents in 1990-94 did feed into a decrease in premiums, the increase in accidents would now inevitably cause premiums to rise, he said. Asked whether the increase in accidents was not compensated by the increase in volume of insurance, he said: "It's the cost of claims at the end of the day."
Mr McHugh questions the insurance companies' justification for the increase in their already high premiums. "Our reported accident frequency is much lower than in the UK, for example," he said
"We did a report on insurance which showed that the claims frequency in Ireland is also lower than in the UK. If you take the smaller accidents out of the equation, there is no great difference between the UK and Ireland. We came to the conclusion there is no justification for the high rate of insurance premiums in Ireland."
He suggested insurance companies in this State maintained larger reserves than elsewhere, and when they said they had operating losses in car insurance, they did not take the interest on their investment income into account.
Mr Horan agreed that operating losses referred to underwriting losses. "Our net underwriting losses on car insurance was £39.2 million last year," he said. "Our supervisory goal is break-even in underwriting. Investment income is what makes up the difference." He could not give a breakdown of what that was, he said.
He admitted that in countries like Britain insurance companies also made an underwriting loss on car insurance, made up by interest on reserves. "But you would go a long way to find underwriting losses on the scale we have here," he insisted.