Uninsured drivers will be liable to have their cars seized under a Government initiative to tackle rising insurance costs. Liam Reid reports
The proposals will target an estimated 80,000 uninsured vehicles on Irish roads, which are estimated to cost up to €90 million annually in claims.
The initiative does not need new legislation and could be introduced by the end of the year.
The Minister for Transport, Mr Brennan, will today outline his plans to the Oireachtas Committee on Enterprise and Small Business, which is holding hearings into the impact of rising insurance costs.
Mr Brennan can use the existing 1994 Road Traffic Act, which permits him to introduce, through ministerial order, regulations allowing the State to seize the vehicles driven by uninsured drivers.
Existing deterrents against uninsured driving - including five penalty points for being caught driving while uninsured, as well as a maximum fine of €2,500 - have proved ineffective.
Crashes by uninsured drivers have been identified by the Motor Insurance Advisory Board as a major factor in the cost of motor insurance.
The Motor Insurance Bureau of Ireland oversees the scheme to cover the compensation costs of crashes by uninsured drivers and accidents where the driver cannot be traced.
According to their figures, the cost of such claims tripled to €90 million between 1995 and 2001. The levy on insurance firms to cover the claims now constitutes nearly 10 per cent of premiums, according to the industry.
The Minister for Transport and the Tánaiste, Ms Harney, are to be questioned by the committee about their progress in implementing other reforms aimed at reducing insurance costs, including the establishment of a proposed personal injuries board and reform of the courts system.
"Tánaiste Mary Harney must seek cast-iron commitments from the insurance sector that any savings that accrue to the sector as a result of insurance reforms are passed on to policy-holders and not shareholders," Fine Gael Senator Paul Coghlan said.
"The Oireachtas committee hearings have heard submissions from a wide range of interest groups. Some have indicated that their members are now facing increased insurance premiums in excess of 70 per cent. We have also heard that a fifth of companies have reduced their workforce primarily as a result of insurance hikes," he added.