Revelations drive insurers into spin

The Irish Insurance Federation (IIF) has spent the week attempting to put a favourable spin on figures which undermine arguments used by the industry for years to justify high premium rates.

The insurers have maintained we are all paying the price for the irresponsibility of youth and that young drivers pay no more and no less than they have to in order to meet the costs incurred.

Now, if figures the Motor Insurance Advisory Board has extracted from the insurance firms are to be believed, it appears these same young people have been yielding greater profits to insurance companies than anyone else.

The federation cries foul but has been unable to dispute the basic arithmetic and its own figures mirror those of its opponents. Hold on, some may say, it is still the case that 17- and 18-year-olds cost far more than they pay. However, few drivers of this age can afford insurance.

This is highlighted by the fact that, once one includes 19-year-olds, the 17-19 category yields a handsome profit.

Granted, the figures cover only the cost of claims against premiums, without including administration fees or, for that matter, investment gains. Nonetheless, the paying public will cheer the harsh light it will throw on the workings of the insurance industry. After years of paying arbitrary motor insurance premiums, they feel the time is right for explanation.