"Some merit" to "pay at the pump" insurance, says AA Ireland's Conor Faughnan

Though he outlined how there are flaws in the system...

With new figures showing a 17% increase in the number of crashes involving uninsured drivers on Irish roads, Conor Faughnan, Director of Consumer Affairs for AA Ireland, joined Mick Clifford on The Right Hook to discuss the feasibility of adopting a "pay at the pump" insurance system, similar to the one currently in place in New Zealand.

There, a motorist's share of tax and levies is included in the price of fuel. While insurance is not compulsory in the country, a driver will be in serious financial difficulty if they are at fault for an accident and are not covered. 

"Essentially a large part of the cost of your motor insurance is embedded in the cost of your fuel," Faughnan explained of the proposal, stating that there is "some merit" to the idea.

"It does mean that everybody pays. It should also mean that the more you drive, the more you pay."

However, he also touched on a number of potential flaws in the system:

"It tends to be perceived as being a little unfair because it can be weighted towards rural drivers, for example, compared to urban.

"And also it takes away the notion of grading people according to their actual risk."

Faughnan's rationale was that, if a person has already been involved in a number of accidents, it is "fair and reasonable" that they should be charged more.

"If you're embedding it all in the fuel price then you do that," he said.

Almost 70% of what you pay at the pump is already tax, with Faughnan wondering how much more we can "lump in" before people start looking across the border.

Instead, he suggested that we put "our own house in order", as he looked to tackle that 17% statistic.

"Our Gardai are not given proper equipment to police that," he argued. "In a country that is supposed to be the Silicon Valley, we're still using pieces of paper [referring to the paper windscreen disc]...

"One of the things we've been calling for is proper data sharing."

Another major problem, in his opinion, is that "Ireland is a country that sues too often, settles too generally and has lawyers involved far, far too often."

Faughnan also pointed out that the actual cost of insurance itself is a "relatively small part of the premium yoou're being asked to pay. And that is a cost that can be reduced."

Currently, he said, we pay for "insurance plus laziness plus stupidity plus failure to act plus the Government's failure to modernise."