INCREASED motor premiums are on the way for 40 per cent of the Republic's motorists following the decision by Guardian PMPA to increase its rates by 5 per cent. Insurers are warning that further rises could follow if the road traffic accident rate continues to rise.
The increase by Guardian PMPA, the largest motor insurer in the State, will take effect on November 1st. The company blamed the rising numbers of deaths and serious road traffic accidents over the past year. It also warned that further rises cannot be ruled out if the Garda does not take steps to enforce road traffic legislation.
Many of the State's smaller insurers have already passed premium rises on to their customers, ranging from 3 per cent to almost 10 per cent. Guardian PMPA, which insures more than 300,090 drivers, is the first of the "big three" insurers to act. The others are expected to follow.
Already this year Norwich Union and Eagle Star have increased their rates, while Hibernian and Celtic have warned they may be forced to follow.
The rises mean that a 32 year old driver living in Dublin with a full no claims bonus and a 1.3 litre car will pay £419, compared to £402 at the moment. However, the same man would have been paying £460 in March 1995 before Guardian PMPA reduced rates last year and early this year. A woman of the same age driving the same car in the midlands will see her premiums for comprehensive insurance rise to £307 from £298.
Guardian PMPA's chief executive, Mr Gerard Healy, blamed the increases on the "worrying trend" in road safety.
Garda statistics show that accidents to the end of August 1996 involving death and serious injury have risen by almost 9 per cent and those involving damage to cars are up more than 12 per cent on the previous 12 months.
Mr Healy called on the Government and the Garda to do "everything in their power" to reduce the number of accidents.
"Stricter enforcement of road traffic legislation is essential if we are to avoid further increases in the numbers of deaths and serious injuries on our roads, which in turn trigger off even sharper rises in motor premiums," he said.
Other insurers have echoed the call. Mr Ian Stuart, managing director of Eagle Star, the sixth largest insurer, said it had raised premiums earlier this year. He warned of further increases in 1997 if the number of accidents is not cut dramatically.
He also pointed to the high level of court awards to accident victims, compared to that in the UK.
Insurance companies are calling for the implementation of recommendations contained in a recent report by Deloitte & Touche which proposed a system to limit the size of payments to victims.
Church & General is likely to increase its rates "modestly", according to a spokesman. Royal Insurance increased its rates by about 10 per cent this year, while Norwich Union increased its premiums by an average of 4 per cent on October 1st.