Car insurance: Fermanagh drivers quoted £4,000 premiums

The rising cost of insurance was a topic of much debate at a recent meeting of Fermanagh and Omagh District Council, with councillors speaking on the "sky high" premiums being experienced by many across the district. 

According to  Sinn Féin Anthony Feely, two local people who had recently passed their driving has been quoted between £4,000 and £4,200 for car insurance, while party colleague, John Feely, said another local driver's monthly insurance bill had risen from £110 to £310. 

Sinn Féin councillor, Stephen McCann, said that one constituent has had their insurance renewal increase by 313 per cent, while a young student was paying more for car insurance per month than rent. 

The West Tyrone councillor also quoted a survey from Compare NI, which revealed that 25 per cent of all drivers in the UK have reconsidered driving altogether due to the cost of insurance. 

"I felt that it was a massive statistic," Councillor McCann said. "It's OK if you live in a big city like Belfast or Derry, but here in Fermanagh and Omagh we have a huge rural area and we don't have the luxury of a regular public transport system."

Councillor McCann added: "The continuing trend of insurance premiums rising should be a huge concern for us all, and we must do all we can to ensure consumers are getting the best value for money."

Last month, the Council wrote to both the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) seeking an explanation for sharp spikes in insurance. 

The FCA hadn't responded, while a letter from Charlotte Gerkin, the PRA's Executive Director of Insurance Supervision, stated that premiums have risen due to "significant increases in the costs of settling motor and home insurance claims."

"It is necessary that insurance firms set their prices appropriately to ensure their safety and soundness, and thereby their ongoing ability to pay policyholder claims," she added. 

Reacting to the letter, Councillor John Feely described the actions of insurers as "shocking". 

"What the insurance companies are doing is shocking," he said. "Insurance companies will always try to blame others, but I haven't heard tell of a car insurance company going out of business in a long, long time. 

"I know one young person in Ederney whose insurance has jumped from £110 a month to £310 a month. That's just crazy."

UUP councillor, Roy Crawford, told the chamber that rising insurance costs are centred around delays in parts and subsequent high demand for hire cars. 

"I recently had a conversation with an insurance provider and they assured me that the problem is around hire cars," Councillor Crawford said. "When a car is damaged, it goes into repair in a car body shop. There seems to be a backlog of parts, and when claimants wait they have to use a hire car. 

"These hire car firms are pushing up premiums, and the customers have to pick up the brunt of it."

Councillor Crawford proposed that the Council write a letter to car hire companies seeking an explanation for high insurance costs. 

Meanwhile, Councillor Seamus Greene proposed that the Council write to the financial regulator to ask if home insurance companies can double their costs without adding to the value of a property. 

"Home insurers are putting up their prices, but they aren't putting up the how much a house is insured for," he said. "If a house is insured for £150,000 and an insurer doubles their costs, the value of the house doesn't go up to £300,000. 

"I feel it is a false argument to say this is because of costs. I propose that we write to the regulator and ask can insurance companies double their costs without actually adding to the value of the property by the equivalent sum?"

Sinn Fein councillor, Dermot Browne, then proposed that the Council write to the Competition and Markets Authority to raise some of the issues discussed.