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Anti-competitive insurance actions alleged

Preliminary findings by the Competition and Consumer Protection Commission (CCPC) have alleged that a number of insurance companies and bodies engaged in anti-competitive cooperation over a 21-month period during 2015 and 2016.

The five insurance companies named were AIG Europe, Allianz, AXA, Aviva and FBD. Brokers Ireland, formerly the Irish Brokers Association, and AA Ireland were also named as being involved.

Findings 'provisional'

The CCPC said the alleged cooperation included public announcements of future private motor insurance premium rises as well as other contacts between competitors. The commission said all of this alleged activity reduced levels of competition between the parties.

“The CCPC’s findings are provisional and no conclusion should be drawn at this stage that there has been a breach of competition law,” it added.

The parties named can now consider and respond to the preliminary findings, and engage with the competition body on making commitments to address its concerns.

The CCPC says it will carefully consider any responses before deciding if it will bring civil court proceedings under competition law or to take some other course of action.

Price-signalling

The commission began the investigation into practices in the motor insurance market in 2016. It looked at suspected anti-competitive practices contrary to section 4(1) of the Competition Act 2002, as amended and Article 101(1) of the Treaty on the Functioning of the European Union.

The activities under investigation include a practice known as ‘price-signalling’, where businesses make their competitors aware that they intend to increase prices.

“If a business knows that their competitor is increasing prices then they may be encouraged to also increase prices, since their customers are less likely to move to their competitor,” the CCPC says.