INSURERS are resisting the Government’s attempts to set up a new claims database.
Critics claim the insurance industry fears it will expose the fact it is inflating its costs to justify high premiums.
The stance of the insurance industry has been labelled a ‘sick joke’.
Insurers had initially embraced plans to set up a claims database that would detail the costs of settling claims and the legal costs.
Included would be claims paid privately by insurers, awards made by the Personal Injuries Assessment Board and by the courts.
This would highlight claims trends. A lack of data on claims has complicated attempts to get a handle on why insurance costs have spiralled.
The national claims information database, to be run by the Central Bank, was supposed to be in place next month.
But the insurance industry is now resisting the setting up of the new database.
It is concerned the Government is now proposing to include non-claims data, such as insurers’ costs, as part of the information to be captured.
Insurance expert and advocate on behalf of policyholders Dorothea Dowling has accused insurers here of inflating their costs as a way of justifying huge premium hikes.
She claims that these “inflated costs” are being transferred to the head offices of insurers abroad.
The lobby group for the industry, Insurance Ireland, has hit out at plans to include what it calls non-claims information in the new database.
“We are concerned that the success of the NCID [national claims information database] may be jeopardised by ‘scope creep’ in the form of a temptation to include non-claims information and excessively granular claims data,” it said in a submission to the Department of Finance.
The pressure group Alliance for Insurance Reform accused insurers of trying to avoid submitting details on their costs.
Peter Boland, of the alliance, said: “It is clear the insurance industry, through Insurance Ireland, is fiercely resisting any attempt to gain an insight into what is going on in the industry.
“As long as it is like that they can do whatever they like without fear of being caught.”
He claimed the Central Bank was letting insurers get away with too much as it is solely focussed on prudential supervision and “has no regard for the impact imposed on policyholders”.
The alliance wants the database to be run by the Personal Injuries Assessment Board.
Sinn Féin finance spokesman Pearse Doherty said Insurance Ireland’s opposition to the new claims database was a ‘sick joke’.
“The opposition of Insurance Ireland and their delaying tactics on the new claims database are a cynical attempt to resist change. Ironically, they claim that the new system could create additional barriers to entry to the market. That seems like a sick joke.”
Insurance Ireland had no comment when asked why it was now resisting the setting up of the new database.
One of the areas where high premiums have caused concern is the motor insurance market.
A major investigation has been launched by the European Commission into motor insurance here, focusing on allegations the industry has created obstacles for new players to enter the market.
Commission investigators are probing claims a new insurer coming into this market has to be nominated by an existing player to join Insurance Ireland. Membership gives access to various databases, but such a situation gives rise to competition concerns.
However, Insurance Ireland insists it is fully compliant with competition law. The focus of the EU probe is whether membership of Insurance Ireland is restricted.