Vehicle Insurance Costs Increase: Experts Point to Key Issues
Rising vehicle insurance costs are a growing concern for drivers. According to Malta Insurance Association Director General Adrian Galea, these increases stem from a combination of factors, including inadequate enforcement on the roads, rising repair costs, and a lack of clarity in legal rulings concerning damages.
In an interview with TVMnews, Mr. Galea specifically mentioned three key issues driving up insurance premiums: enforcement, the cost of panel beaters’ services, and the lack of clear legal guidance regarding damages awarded by the courts. He emphasized the long-standing nature of these issues and the association’s efforts to address them.
“Unfortunately, I can state unhesitatingly that all this has fallen on deaf ears. We have long been referring to these issues.”
Specifically, Mr. Galea mentioned donations of breathalyzer kits and the preparation of legal amendments concerning anti-drug enforcement. He highlighted the increase in accidents and the escalating costs of vehicle repairs, indicating that even replacing a bumper on a modern car can be exceptionally expensive due to the advanced technology involved.
Data from the National Statistics Office (NSO) reveals a significant number of road accidents. Between 2021 and 2023, there were over 15,400 reported accidents, averaging 42 per day. The highest number of accidents in the past three years occurred in 2023, with over 16,000 incidents, or an average of 45 accidents per day, four of which resulted in injuries.
Industry sources told TVMnews of the disparity in insurance costs between young and adult drivers; a young driver can expect to pay approximately €1,200 for comprehensive insurance, while an adult with a no-claims bonus may pay around €400 for a similar policy.
Mr. Galea outlined several underlying factors for the increasing insurance costs:
- Accidents abroad
- Unforeseen compensation awarded by the courts
- Reduced enforcement efforts
Mr. Galea stressed the importance of the government addressing these issues, even if costs do not decrease. He noted instances where insurance premiums decreased in the past. He also underscored the need for legal clarification, as insurance companies are currently uncertain about the minimum and maximum amounts they may be required to pay out. He emphasized the significant impact of increasing costs, especially regarding vehicle components and repair services.
“The fact that you have gone abroad and were involved in an accident, the fact that Courts are awarding compensation of which we are not aware, the fact that there is less enforcement… these are all issues that, if they are still ignored, if the Government does not heed our pleas… Even if costs don’t go up or down, this is also important. There were circumstances where insurance costs went down. Possibly this might not happen frequently at a time when everything is becoming more expensive Take parts, repairs…”
