Commitments from six parties in the private motor insurance sector
February 8, 2022
The Competition and Consumer Protection Commission (CCPC) secured legally binding commitments from six parties that were under investigation in the private motor insurance sector.
The parties are:
- AIG Europe S.A.
- Allianz PLC
- AXA Insurance DAC
- Aviva Insurance Ireland DAC
- FBD Insurance PLC
- AA Ireland Limited
Outline of case
In 2016, the CCPC commenced an investigation into suspected anti-competitive practices in the provision of private motor insurance in the State, contrary to section 4(1) of the Competition Act 2002 (2002 Act), as amended and Article 101(1) of the Treaty on the Functioning of the European Union (TFEU). Section 4(1) of the 2002 Act and Article 101(1) TFEU prohibit anti-competitive agreements, concerted practices and decisions by associations of undertakings which have as their object or effect the prevention, restriction or distortion of competition.
Price signalling occurs when businesses make their competitors aware that they intend to increase prices. 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.
In September 2020, the CCPC issued preliminary findings to a number of parties who had made the original public statements of concern, as well as others whose conduct had been examined during the course of the investigation. The parties who were issued with preliminary findings were AIG Europe S.A., Allianz PLC, AXA Insurance DAC, Aviva Insurance Ireland DAC, FBD Insurance PLC, AA Ireland Limited and Brokers Ireland Limited setting out identified competition law concerns while giving each party the opportunity to propose remedies to address the competition law concerns. The organisations involved have denied their involvement in a breach of competition law. However, in the interests of addressing the CCPC’s concerns and following a period of significant engagement, the CCPC has agreed to accept binding commitments from AIG Europe S.A., Allianz PLC, AXA Insurance DAC, Aviva Insurance Ireland DAC, FBD Insurance PLC and AA Ireland Limited.
The commitments require each company to implement and maintain an appropriate internal competition law compliance program, or enhance any existing programmes, to include:
- provision of an internal monitoring mechanism to detect, identify and report suspected breaches of the compliance programme;
- provision of a mechanism for employees reporting suspected breaches and protection for the employee that comes forward;
- appointment of a compliance officer who must report to the Board of the organisation;
- regular competition law training on pricing practices and communications that are not permitted under the law;
- independent expert oversight of the compliance programmes including various auditing and reporting requirements;
- an annual submission to the CCPC demonstrating conformity with the commitment.
The CCPC can take legal proceedings to enforce the agreement should any party fail to comply.
The investigation closed in August 2021 after AIG Europe S.A. Ireland Branch Office, Allianz PLC, AXA Insurance DAC, Aviva Insurance Ireland DAC, FBD Insurance PLC, and AA Ireland Limited entered into legally binding agreements with the CCPC where they committed to reform their internal competition law compliance programmes. A seventh party, Brokers Ireland (formerly the Irish Brokers Association and the Professional Insurance Brokers Association) refused to enter into similar commitments.
- Section 4 of the Competition Act 2002
- Article 101 of the Treaty on the Functioning of the European Union