Motor insurers will have to explain why premiums are increasing under new code

Kenneth Fox

Motor insurers would have to explain to customers why their premiums are going up, under a new voluntary code.

The Government initiative aims to provide more transparency and pass on the effects of recent insurance reforms to consumers.

Companies that sign up would also have to give a breakdown on premium calculations, charges and discounts.

Junior Minister Robert Troy says the initiative is the first of its kind here, and says the aim is for it to take effect from this month.

Developed by a working group comprising insurers and intermediaries, with the support of the Department of Finance and the Central Bank of Ireland.

They said the code will enhance trust, clarity, transparency, and understanding in how motor insurance premiums are presented to consumers.

Some of the key features of the code include:

-A new premium summary statement, provided at quotation and renewal, setting out last year’s premium, the new premium, the difference, and the key factors influencing pricing (including levies, risk factors like geographical location, and license type).

-An annual market overview statement, providing consumers with accessible explanations of broader market conditions affecting premiums, including profit, broker commission, and legal costs.

-The code is voluntary and is open to all insurers and intermediaries selling private motor insurance in the State to adopt, including cross‑border entities.

-Along with an overview of their personal risk factors and market trends, consumers will also be given clear guidance on how they can reduce their risk profile and potentially lower their costs.

Speaking about the code, Minister of State for Financial Services and Insurance, Robert Troy, said, "This new transparency code is a first of its kind for Irish consumers.

"It will bring further transparency to the market and support consumers to know what they are paying for, and if there are legitimate reasons for why premiums have increased.

"By insurers and intermediaries explaining premium changes in plain language and providing insight into individual risk factors as well as wider market trends, the code will empower consumers to make more informed decisions.

"I hope that this code will enhance switching behaviour and arm consumers with the right information to receive a better motor insurance outcome.

"I welcome the engagement from industry and the Central Bank of Ireland in developing and adopting the code and want to emphasise that a timely and effective implementation from March 2026 will be essential to delivering real benefits for policyholders."