MOTOR INSURANCE
Rules
| Rates
| How
to apply | Further
information
INFORMATION
It is a legal requirement in Ireland to have motor insurance
if you want to drive your car in a public place and you must
produce a current Certificate of Insurance to pay
motor
tax. Failure to have motor insurance when driving in Ireland
is a very serious offence and drivers will incur fines, penalty
points and may be disqualified from driving. (See 'Rules'
below).
Motor insurance is about protecting other road users as
opposed to the driver of the insured vehicle and it is not
an optional extra. Insurance companies provide motor insurance
and unlike road tax, there is no such thing as a "standard"
rate.
Young drivers represent a high risk for insurers and the
cost of motor insurance in this age group is considerably
higher than for others both in Ireland and throughout the
European Union (EU). Ireland currently ranks extremely high
of the 25 EU member states on road accident frequency and
it has the highest fatality rate in Europe.
In 2004, 379 people lost their lives on Irish roads. (The
figure was 341 in 2003).
There are a number of things young drivers can do to reduce
the cost of motor insurance:
- Join a parent's insurance as a named driver as early
as possible. This will enable you to establish a safety
record, which is crucial when you want to apply for insurance
in your own name. Some companies offer discounts to young
people seeking insurance in their own name if they have
been a named driver.
- Get a full licence as soon as possible. Having a full
licence will reduce the cost of your insurance premium
considerably. Savings vary, but it is possible for a young
driver to save a vast amount (up to 900 euro or more)
on the cost of his or her insurance premium simply by
having a full driving licence.
- Choose a car with a relatively small engine, as less
powerful cars are cheaper to insure.
- Drive carefully. The best way to reduce the cost of
your motor insurance is to build up your no claims bonus.
MOTOR INSURANCE AND THE EQUAL STATUS ACT
The Equal
Status Act, 2000 (Section
5(2)(d)) allows differential treatment in relation to
the calculation of insurance policies in Ireland. This means,
that insurance companies are allowed to charge higher or
lower rates for policies on the basis of your potential
risk as a driver. Given that younger drivers in Ireland
are statistically more likely to have accidents, this explains
why there can be sizeable differences in insurance costs
between younger and older drivers.
TYPES OF MOTOR INSURANCE POLICY IN IRELAND
The most basic insurance is "third party"
and this is the minimum required by law. However, third
party is only one of three main categories.
COMPREHENSIVE
This is the most expensive type of insurance on the market
and covers you for almost every eventuality: any damage
done to the vehicle regardless of how it was incurred; life/accident
insurance; loss of personal belongings from the car; the
cost of a hired car if the insured car is off the road as
a result of an accident; windscreen breakage, etc. With
more brand new cars on the road than ever before, there
has been a notable rise in people taking out comprehensive
insurance. A brand new car should be comprehensively insured.
THIRD PARTY, FIRE AND THEFT
This is the most popular form of motor insurance in
Ireland. It covers you for loss of the vehicle through fire
or theft and for any loss as a result of attempted fire
or theft. Damage to property is also covered. There are
also optional extras available such as windscreen breakage.
THIRD PARTY
This is the minimum cover required by law, but it does have
restrictions and limits, leaving you open to substantial
loss in the event of an accident. If you are at fault, then
only your passengers and the driver and passengers of the
other vehicle will be compensated. This type of insurance
provides no cover for damage sustained in an accident to
your car or if your car is stolen or goes on fire.
An insurance company considers many things when calculating
an insurance premium. Most premiums are based on basic third
party cover with the cost of extras added on. The main thing
that will determine the cost of your insurance is what you
actually want to be covered for. The following are always
taken into account:
LICENCE
Whether you are driving on a full or provisional licence
makes a huge difference to the cost of your motor insurance
premium. You can expect to pay hundreds of euro extra, if
you only have a provisional licence.
SIZE AND AGE OF CAR
The engine capacity and age of the car play a large part
in determining the cost of your premium. The older the car,
the more difficult it can be to insure. Many insurance companies
believe that the older a car is, the more accident-prone
it becomes. A new car is more expensive to replace than
an old car and will cost more to insure. Likewise, the more
powerful the car you drive, the more it will cost to insure.
AGE OF THE DRIVER
The young and the old represent high-risk categories
and pay more for insurance.
VALUE OF THE CAR
The value of a car is taken into account for third party,
fire and theft and for comprehensive insurance. What you
have the car insured for, however, is not always what the
insurance company will pay out in the event of a claim.
In the event of the car being a write-off, the insurance
company will only pay out what it feels the car is worth,
which, more often than not, is less than the car is actually
insured for. There is very little to gain by over-insuring
a car and, equally, you should not under-insure it either.
EXPERIENCE
All insurance companies will ask if you have ever had
insurance in your own name before. If not, they will ask
if you have ever driven under someone else's insurance without
incident. This will be taken into account when calculating
a premium. Insurance becomes less expensive with experience
and a clean driving record.
PROFESSION AND USE
Some professions are considered to be more at risk than
others and will have a loading put onto their premium. What
the car will actually be used for is also taken into account.
A standard policy covers the vehicle for social, domestic
and pleasure purposes, but not for the carriage of goods.
If the car is being used for business, then a loading will
apply. If the car is being used commercially, then an even
higher loading will be imposed.
WHERE THE CAR IS KEPT
Those living in a major city, particularly Dublin, will
normally have a loading imposed. Some companies will also
impose a loading if the car is not kept in a garage at night.
EXCESS & EXTRAS
Most insurance policies contain some type of an excess clause.
This means that the policyholder is liable for an agreed
amount towards the cost (e.g., the first 250 euro). The
premium will cost more if this clause is taken out. It pays
to shop around, because what might be considered an extra
in one company (windscreen breakage, car hire in the event
of the car being off the road, loss of personal effects,
etc.) could be standard in another.
NO CLAIMS BONUSES
A no claims bonus is built up over the years and gives
the policyholder a substantial reduction in the cost of
his or her premiums. The ceiling for a no claims bonus is
usually around 60%, leaving someone who has never had a
claim with only 40% to pay. In the event of a minor accident,
it is sometimes cheaper to pay for any damage out of your
own pocket rather than claiming from your insurance and
losing your no claims bonus. If you make a claim and subsequently
lose your no claims bonus, you can build it up again in
a few years. Some insurance companies will even allow you
one claim without it affecting your no claims bonus.
RULES
You must have motor insurance to drive a car in your own
name or as a named driver on someone else's policy.
Failure to have motor insurance or driving without insurance
in Ireland is generally punishable by:
- A fine of up to 2,500 euro,
- Disqualification of one year or more for a first offence
and two years or more for a second offence, and
- At the discretion of the court, a term of imprisonment
not Exceeding six months
In the case of a first offence of driving without insurance,
the court may decide in special cases not to impose a period
of disqualification or to impose a period of disqualification
of less than a year.
Since 1st June 2003, where the courts in Ireland decide
not to impose a disqualification, drivers convicted of a
first offence of driving without insurance will incur 5
penalty points on their licence record in addition to any
other penalty imposed by the court.
If you commit a second offence for driving without insurance,
you will be automatically disqualified from driving. You
should also note, that where a member of An Garda Síochána
(Irish police force) believes that a mechanically propelled
vehicle being used in a public place, that is registered
in the State, is being driven without insurance, your vehicle
may be impounded.
IF YOU ARE REFUSED MOTOR INSURANCE
Individual insurers have the right
to refuse you cover, but they must provide you with
a reason for the refusal should you ask for one.
However, even though you have been refused cover, you are
entitled to go to the Declined Cases Committee of the Irish
Insurance Federation who will obtain an insurance quotation
for you. In order for the Committee to consider your case
you must first have sought and been refused quotations in
writing from at least three insurers. (See 'Further information'
below).
RATES
With more companies than ever before competing for business,
it is possible to make considerable savings by ringing around
for the best quote.
HOW TO APPLY
You can apply for motor insurance over the phone, in
person or through a motor insurance broker. Motor insurance
companies and insurance brokers are listed in your
public telephone directory. If you want to drive as
a named driver on someone else's policy, then that person
must contact their insurance company and arrange to have
you insured under their policy.
FUTHER INFORMATION
The Insurance Ombudsman deals with complaints and disputes
between policyholders and their insurance companies when
the company's complaints procedure fails to resolve the
problem. The Insurance Ombudsman can oppose an insurance
company's decision in relation to an individual policyholder.
This decision is binding only on the company, which means
you may proceed with court action if you are not satisfied
with the ruling.
Insurance
Ombudsman of Ireland,
32 Upper
Merrion Street, Dublin 2. Tel:
(01) 662 0899 Fax: (01) 662 0890
The Insurance Information Service (IIS) is an information
and complaints telephone service operated by the Irish
Insurance Federation (IIF), which many insurance companies
in Ireland belong to. Its purpose is to answer policyholders'
questions and help them resolve problems. It has no binding
powers and complaints that cannot be resolved are generally
referred to the Insurance Ombudsman.
Insurance Information Service
39 Molesworth Street
Dublin 2.
Tel: (01) 676 1914
If you have been refused a quotation for motor insurance,
you are entitled to go to the Declined Cases Committee of
the Irish Insurance Federation who will obtain a motor insurance
quotation for you:
Declined Cases Committee
Irish Insurance Federation
39 Molesworth Street,
Dublin 2. Tel: (01) 676 1914
(Source:
http://www.oasis.gov.ie/transport/motoring/motor_insurance.html)
