MIBI told to pick up the tab for Setanta claims

coylemj

This will push up motor premiums even more, it also means that companies operating in the Irish market will have to pay for liabilities left behind when companies go bust, it may lead to some foreign companies pulling out of the Irish market altogether.......

The Court of Appeal has found the Motor Insurers Bureau of Ireland (MIBI) is potentially liable for hundreds of outstanding claims following the collapse of the Setanta insurance firm.

The ruling has important implications for motor insurance premiums as well as parties involved in claims concerning Setanta.

http://www.irishtimes.com/business/financial-services/court-says-mibi-liable-for-setanta-claims-1.2557152

To Elland Back

Shocking news for motorists. It's a precedent which may be exploited by fly-by-night insurers to allow them skip town and have the MIBI pick up any shortfall

mickmackmcgoo

So there is 90 million they are liable for. Now if there are approx 3 million drivers insured then that works out a 3o euro per person once off so I'm sure all premiums will just rise by 30 euro. Yeah right!

To Elland Back

mickmackmcgoo wrote: »

So there is 90 million they are liable for. Now if there are approx 3 million drivers insured then that works out a 3o euro per person once off so I'm sure all premiums will just rise by 30 euro. Yeah right!

Loads of assumptions there. The latest statistics say there are 2.7m licences in effect in Ireland. Not every licence holder owns their own vehicle, many share. Not every licence holder currently drives. And, obviously, many licence holders drive uninsured. You could be looking at approx €50-€60 per insured Driver, which could easily be €150 per policy with a number of drivers on it.

Very dangerous precedent

Voodoomelon

Insurance in Ireland is in shambles. Genuinely worrying stuff for anyone that owns anything of value.

CiniO

mickmackmcgoo wrote: »

So there is 90 million they are liable for. Now if there are approx 3 million drivers insured then that works out a 3o euro per person once off so I'm sure all premiums will just rise by 30 euro. Yeah right!

I think there's around 2.5 million vehicles in Ireland. Not all of them are currently used on the road, and out of those which are, there's still probably about 6% uninsured (extremely high figure comparing with any other EU country).
It will be more like around €50 per policy.

Seth Brundle

Voodoomelon wrote: »

Insurance in Ireland is in shambles. Genuinely worrying stuff for anyone that owns anything of value.

Insurance companies on the whole are not currently making a profit here.
This is due to fraud (which on average adds €50 per policy) and the high cost of payouts.
It requires joined up thinking from a number of bodies before prices will look like going down

Atlantic Dawn

MIBI have a lot to answer for too, they give a blanket agreement that they would pay out if a member became insolvent yet allow the cowboy operator within their membership.

The Law Society, in opposing the appeal, said it was envisaged, in all the various agreements governing the MIBI since it was established in the 1950s, it would have to pay out if a member became insolvent.

The MIBI is operated under the terms of an agreement between the Government and those companies underwriting motor insurance in Ireland to deal with claims related to uninsured drivers.

http://www.irishtimes.com/business/financial-services/motorists-face-higher-premiums-after-setanta-ruling-1.2557152

To Elland Back

Atlantic Dawn wrote: »

MIBI have a lot to answer for too, they give a blanket agreement that they would pay out if a member became insolvent.

Where do you get that?

Atlantic Dawn

To Elland Back wrote: »

Where do you get that?

http://www.irishtimes.com/business/financial-services/motorists-face-higher-premiums-after-setanta-ruling-1.2557152

Arkady

Yet another scam in scamland. Boy do the corrupt financial "elite" in Ireland really love using the insurance industry to fleece the Irish public.

To Elland Back

That was the Law Society's argument, not the MIBI previously giving an undertaking to underwrite insolvent insurers

robtri

kbannon wrote: »

Insurance companies on the whole are not currently making a profit here.

where did you get this from??

bazz26

Typical Irish solution to an Irish problem. Just push the burden of recklessness around until it lands on the lap of the consumer or taxpayer rather than tackling the problem head on.

Arkady

kbannon wrote: »

Insurance companies on the whole are not currently making a profit here.

Never knew many taxi drivers to ever make much profit either. Saves paying too many of those pesky taxes.

kbannon wrote: »

This is due to fraud (which on average adds €50 per policy) and the high cost of payouts.
It requires joined up thinking from a number of bodies before prices will look like going down

Then why don't the insurance industry do something about it, instead of continually gouging the customers that don't make fraudulent claims instead ?

With modern IT capabilities and access to records, there's absolutely no excuse for not detecting and combating Insurance fraud. But it's easier and cheaper to do nothing about them, and much more profitable to load non fraudulent customers instead, while whinging about the fraud you do nothing about, and while continually inventing loophole after loophole to refuse genuine claims.

ongarite

robtri wrote: »

where did you get this from??

In the news this week, FBD are in serious trouble, lost nearly 100m last year and on track for reduced losses again this year.
Payouts from courts and claims are out of control in the country. Way out of kilter compared to rest of Europe.

Arkady

bazz26 wrote: »

Typical Irish solution to an Irish problem. Just push the burden of recklessness around until it lands on the lap of the consumer or taxpayer rather than tackling the problem head on.

Much more profitable for the golden circle, and a lot less work.

Atlantic Dawn

80% of claims are for whiplash, crazy amount, we could be heading for an average of a grand a year premium..

The head of Insurance Ireland said today that claims for whiplash in motor accidents here now accounts for up to 80 per cent of motor insurance claims compared with just 3 per cent in some other countries.

Kevin Thompson, chief executive of the organisation said at the moment awards for whiplash in Ireland average € 15,000 per case compared with € 5,000 in the UK and € 3,000 in France and Spain.

He was reacting to comments from AIG, the world’s biggest insurer, which wants Ireland to consider banning whiplash claims to help counter soaring motor insurance charges and to avoid the average cost of premiums hitting € 1,000.

http://www.irishtimes.com/business/financial-services/whiplash-accounts-for-80-of-motor-claims-insurance-chief-1.2549433

the_syco

Atlantic Dawn wrote: »

80% of claims are for whiplash, crazy amount, we could be heading for an average of a grand a year premium..

We should look at how the UK deals with the whiplash issue;
http://www.mirror.co.uk/money/autumn-statement-2015-bang-goes-6900117

the Chancellor announced that that compensation for injury would no longer be in cash but in medical care, while more small claims will be able to go to the small claims court with an increase in the upper limit from £1,000 to £5,000.

micosoft

Atlantic Dawn wrote: »

80% of claims are for whiplash, crazy amount, we could be heading for an average of a grand a year premium..



http://www.irishtimes.com/business/financial-services/whiplash-accounts-for-80-of-motor-claims-insurance-chief-1.2549433

So 80% is "fraud" through whiplash. The rest is shoring up those who should never have gotten insured through Setanta and of course, lest we forget!, our friends the Quinns who we now pay a surcharge for Quinn Directs recklessness. It would almost cause you to go uninsured... after all, somebody else will take the fall!

TallGlass

So are motorists and tax payers just going to continue on paying out for mistakes of corporate companies?

These companies should be chased to the end of the earth for the money, you bet your ass that it's owner isn't short for cash and pull the plug so it didn't have to come out of his pocket. Do these companies not keep reserves for operation or anything?

To Elland Back

Let's be perfectly clear about this issue. The MIBI is not a business. It is a non-profit organisation which deals with uninsured drivers who cause accidents on our roads.They get the money to pay these claims from you and me, via the policies we take out with insurance companies issued with a licence by OUR GOVERNMENT.

Setanta issued perfectly valid insurance policies and it's motorists were not UNINSURED. The problem was that there were insufficient funds to meet its claim commitments. IMO the responsibility to carry the can for this rests with the regulatory bodies and, ultimately, central government, not with insured motorists. It is yet another example of Government not wanting to touch any aspect of our insurance industry, other than to take a chunk of tax.

This latest cost will be passed on to us motorists, be in no doubt over that. The figure is too big and the market too small for it to be absorbed by the MIBI. Standard contributions from insured motorists were already due to rise on account of higher claim awards and increased fraud. So when your increased renewal premium comes in from Company X, think back to this ruling

TallGlass

Also, just thinking there. So we VAT, Insurance Levy x1, there looking at bringing in Insurance Levy x2 (for floods) and now looking at bringing in Insurance Levy x3 (for this mess). Do we just keep on adding levy's each time someone fails/fúcks up?

Seems to me, you get off lightly or nothing is done at all if you don't play by the rules. That goes for both drivers and insurance companies, but if you do your pinned to the wall and robbed blind by government policy.

To Elland Back

No VAT on insurance premiums

Your other points are valid. Incentives not to do the honest thing are very high in this country

Radharc na Sleibhte

The agreement is there plain to see that the MIBI foot the bill. Hence why the high court and court of appeal judged accordingly.
What I want to know is why is there seemingly no funds whatsoeverin the kitty to pay for this? Why do they have to put all our premiums up? Insurance Ireland and the MIBI are obviously ill prepared for such an eventuality. Maybe not to the degree of €90m but you would have thought a prudent business/group would be prepared for such an event. Just another excuse to increase premiums. Sure they we're blaming Setanta for premium rises this last 12 months before any ruling. If it wasn't this they'd be blaming the floods and whiplash on Radio 1 instead. It's pure spin and people are buying it.

Arkady

To Elland Back wrote: »

Incentives not to do the honest thing are very high in this country

Most of all for Irish Insurance companies and their supporters.

Special Circumstances

Radharc na Sleibhte wrote: »

Just another excuse to increase premiums. Sure they we're blaming Setanta for premium rises this last 12 months before any ruling. If it wasn't this they'd be blaming the floods and whiplash on Radio 1 instead. It's pure spin and people are buying it.

Great boys for getting the retaliation in first.
"There are no genuine honest owners of 14 year old plus cars. Fraudster scum the lot of them. Well maybe one or two are ok, but what do want us to do about it? We're untouchable mwuahahaha"