News that Irish insurers were to offer refunds to customers because of a drop in claims due to Covid-19 restrictions was welcomed last week, but as the scale of the “refunds” becomes apparent motorists are likely to be left very disappointed by the support they receive.  

Allianz, Axa, FBD, RSA, and Zurich have all signed up to an agreement to offer refunds, but are yet to make clear what they will be offering. The first move has been made by Liberty Insurance which has outlined its plans announcing that its customers will get 15% of their premium back for a period of two months.

This means for example that if the premium is €1000, the driver will get just €25 back. There is a minimum refund of €10, but the refund will not be automatic and customers will have to apply through the Liberty website from June 8th. There will also be the option of donating the refund to charity.

Other insurers are expected to offer refunds of similar levels, although the complexity of the rebate process remains unclear.

Whilst offering some king of refund is to be welcomed, the level of refunds and the likely complicated claims process is disappointing. Accident rates and claims are said to be down by well over 75% as the majority of drivers are either not using their cars, or are making only short journeys. Insurers consistently argue that it is high claims cost and accident rates that are driving up premiums, yet when claims drop to unprecedented low levels they seem umprepared to look after their hard pressed customers. This is once again an illustration of how a lack of transparency in the industry means a bad deal for motorists.