Somebody has got it wrong
Recently the Assembly Finance Committee, following a recommendation from the Consumer Council, agreed to set up an inquiry into the high cost of insurance in Northern Ireland.
Joleen Cunningham from the Consumer Council told the finance committee that the establishment of the new Department of Justice could have an impact on lowering the cost of insurance in Northern Ireland. Ms Cunningham further added that Car insurance costs 80% more in Northern Ireland – an average of £282 extra than in Britain.
The Consumer Council said that NI households pay an average of £278 more for all their insurance than in the rest of the UK.
We then had Mitchel McLaughlin MLA accusing the Insurance Industry of “playing fast and loose” with NI consumers and said there was a lack of competition.
Mr McLaughlin then added the comment “all insurance companies were dealing with a small number of clearing houses in Northern Ireland”
On the other hand The Financial Regulator stopped a major player in the Insurance Market in Northern Ireland from trading because they are too cheap and have lost money in the last 2 years. They were allowed to go back underwriting Private Car only after increasing their rates by a minimum of 20%.
They have been told they cannot go back into other lines of business until they stop underwriting Loss leaders. Press reports said that they needed to increase commercial rates by 3000%. I take that with a large pinch of salt but think it is nearer 100%.
So who is right? Lets look at THE FACTS
“All insurance companies were dealing with a small number of clearing houses in Northern Ireland”
Mitchel, a small point, Banks use clearing Houses not insurance companies. If you are talking about Insurance Brokers there are 124 Registered Insurance Brokers and Agents resident in Northern Ireland and several more based in GB (Lloyds and London Market) and RoI who offer facilities in Northern Ireland.
“Lack of competition.”
If the rates the Consumer Council say are charged in Northern Ireland “an average of £282 extra than in Britain,” you could not get office space in Belfast with all the Insurance Companies trading in the UK setting up shop. After all we are only an hour from London, use the same currency and speak the same language – or roughly the same language
I am no supporter of Aggregator sites but I took the opportunity to go on GoCompare.com. For both Household and Motor Insurance I was given no less than 21 alternative quotes. I changed the address getting quotes for the same risk in London, Manchester, Edinburgh and Glasgow – and where the cheapest area was – yes Northern Ireland. Try the site – but don’t tell the people in GB they will only want to move here and push house prices up. The Consumer Council are busy enough without that problem.
It makes you wonder if Ms`s Gildernew and Foster joining the Quinn protest in Enniskillen was less to do with saving jobs and more to do with keeping cheap and loss-making insurance – who cares if an Insurance Company goes bust.
Jack McIlduff
MD
Europa General Underwriters (NI) Ltd
(An RSA Group Company)
Contact telephone number: 028 90320190
The content of this article is provided for information purposes only and does not constitute professional or other advice.
Wednesday, June 30th, 2010
