An investigation by the Competition and Consumer Protection Commission has found that five insurance companies, an insurance industry trade association and an insurance broker allegedly engaged in anti-competitive co-operation.

This took place over a 21-month period during 2015 and 2016.

In its preliminary findings, the CCPC named the companies as AIG Europe, Allianz, AXA Insurance, Aviva Insurance, FBD Insurance, Brokers Ireland - formerly the Irish Brokers Association - and AA Ireland.

The alleged anti-competitive co-operation consisted of public announcements of future motor insurance premium rises as well as other contacts between competitors.

All of this reduced levels of competition between the parties, the Commission said.

The CCPC said its findings are provisional and no conclusion should be drawn at this stage that there has been an actual breach of competition law.

In 2016, the Commission started an investigation into suspected anti-competitive practices in the provision of private motor insurance in the State.

The activities under investigation include a practice which is commonly referred to as "price-signalling".

This occurs when businesses make their competitors aware that they intend to increase prices, in turn causing further price increases across the sector. 

Price signalling can happen in public, through announcements or comments on prices, or in private through direct contacts between companies. 

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 said.

The CCPS said the companies named now have the opportunity to consider and respond to its preliminary findings.

It said it will "carefully consider" any responses before deciding if it will bring civil court proceedings or take some other course of action.

In a statement, the CCPC said it acts to protect consumers and uses its statutory powers to bring anti-competitive practices to an end. 

"Price signalling and other types of anti-competitive cooperation between competitors ultimately lead to increased prices for consumers," it stated. 

"These practices are particularly harmful to consumers when they occur in sectors like private motor insurance where motorists are required by law to take out cover and cannot avoid price increases," it added.

Brokers Ireland to challenge CCPC's findings

Brokers Ireland said it strongly rejects the preliminary findings by the CCPC in relation to price signalling during 2015 and 2016 and would vigorously challenge them.

Brokers Ireland was formed in 2017 when the Irish Brokers Association merged with the Professional Insurance Brokers Association (PIBA). 

In a statement, Brokers Ireland said there had been a prolonged "soft period" (falling premiums) in the motor insurance market, which became protracted after the last recession. 

But it added that by 2013 there was a change of course with diminished capacity in the insurance industry arising from the failure of a number of insurers in the Irish motor insurance market, a massive recapitalisation of the Irish arm of an international insurer and the impending application of new regulations. 

"By 2015, the increases in motor insurance premiums had become a frequent subject of dinner table conversation and general comment. The IBA, reacting to public interest, participated in this debate," it added. 

"Whatever the merits of this, the actions of the IBA cannot, in fairness, be said to have caused or contributed to increasing the cost of motor insurance, " Diarmuid Kelly, chief executive of Brokers Ireland said. 

"The upward cycle was firmly in action by this point, due to factors entirely outside the sphere of influence of the IBA," he added.