What's the news?
With a serious shortfall in the number of workers in the construction industry right now, you'd think that every effort was being made to attract home those who left during the worst days of the recession. And you'd be right, up to a point. The latest SCSI/PwC Construction Market Monitor Report 2018 states that skills shortages remain an acute challenge for Ireland's construction sector, with chartered surveyors and other industry experts reporting an undersupply hovering between 53 per cent to 84 per cent.
There's a big problem though. Those coming home to take up employment on the building sites are finding that they can't afford to insure a car, mostly because their time driving overseas is not being counted, by Irish insurers, towards their no-claims bonus.
Insurance experts at XS Direct set out the issues and a possible solution, with David Shaw, Director at the insurer commenting: "Reports indicate that the combination of current problems in housing, motor insurance, and banking will result in a dearth of a much-needed skilled labour force in Ireland. The property sector is continuing to pick up, and without sufficient labour, construction demand will not be met. However, the behaviour of some product and service providers does not reflect an appreciation of these national labour demands. This is particularly evident in the motor insurance sector where insurers will either not quote returning emigrants or will make it prohibitively expensive for them to take out insurance. We have developed an insurance policy for retuning emigrants who don't have the No-Claims Bonus (NCB) cert generally required in the market. They'll still pay a little more than a corresponding worker who'd stayed in Ireland, but it will get them on the road and will help to rebuild their recorded NCB, so they can reprice next year."
OK, so that means that XS Direct has a vested interest in all of this, but even taking that into account, its research turned up some interesting, not to say disturbing figures. It's not just a matter of high insurance costs; it's a matter of many in the construction industry finding that they can't even get a quote.
XS Direct took a sample case of insurance for a construction worker aged 40 living in Blackrock with a Full Australian Licence on a 2013 Peugeot 508 1997cc. The worker would have been living in Australia for the last 5 years, returning to Ireland at the start of 2018. All four major Irish insurers - Axa, Aviva, Libery, and Allianz - all declined to quote, mostly because they said that the applicant had no previous policy in their own name.
"The Australian systems is fundamentally different to ours - many people opt for the cheaper option which is an open policy - meaning the car is insured but the driver is not named on the policy. Not everyone who moved 'down under' to work bought a car and had their own policy - in fact, from what we have seen most did not" said Shaw. "While some insurers will quote for a person who has had their own policy and driving experience in Australia, their acceptance criteria are very restrictive, and do not take into account two main factors that will preclude most of the returning workers from getting insurance."
In a survey of the worst problems affecting their return home, emigrants listed housing (43.4 per cent), motor (41.4 per cent), and finance and banking (16.3 per cent) as "very difficult", and the most challenging areas on their return. Indecon, the independent body that carried out the DFA report, recommended that the Government highlight and encourage companies that help return migrants with these barriers, for example motor insurance companies that accept and offer no-claims discounts, and recommend that these companies should be available on a dedicated website that will offer best in class online information to help returning Irish migrants and people moving to Ireland.
"We need to entice these workers home. At the moment, at the most fundamental level, it seems we are doing the opposite. Those working in construction make up a large portion of our client base and the feedback we receive from them is two-fold," said Shaw. "If they have worked overseas in recent years, then traditional insurers either won't quote them or will only quote them prohibitively high premiums. The fact that a person works in the construction sector can push up their motor insurance premiums with other insurers.
"These issues need to be addressed - we do not want insurance to act as a barrier that will deter our much-needed skilled construction workforce from living in Ireland. At XS Direct we have developed an affordable insurance policy with these people in mind - people that other insurers simply don't want to deal with because they can't show a No-Claims Bonus (NCB) cert. The Indecon survey identified the costs involved in driving as a source of major frustration for our returning work force. One respondent actually said that the 'cost of car insurance is going to force us back to Australia'. The onus is now on the Government and the motor insurance industry to ensure that we don't lose our workforce for the second time in recent years."