Guernsey and Jersey turned down Gibraltar motor insurance offer

Gibraltar-based motor insurance companies stopped providing coverage to the Channel Islands and the Isle of Man in September

Guernsey and Jersey turned down a deal that could have curbed rising car insurance prices due to a "substantial risk" to taxpayers.

Last year Gibraltar-based companies stopped providing Channel Islands coverage due to high liability levels.

Some motorists have since seen their premiums go up, or their coverage pulled due to post-Brexit changes.

The States said it had declined an offer from Gibraltar's government to transfer financial liability.

It said if it had accepted the offer it would have posed a "substantial risk" for taxpayers.

"The Gibraltar Government advised the States of Guernsey that because of post-Brexit arrangements, its motor insurance sector cannot supply services without placing a substantial and direct financial risk to the Gibraltar Government," a spokesman said.

"It was only willing to support the continued supply of services if the States of Guernsey directly take on that financial liability.

"Given the substantial financial risk as well as wider motor insurance changes post Brexit, this offer was not taken forward, noting that other providers from other jurisdictions are available."

'Sufficiently competitive market'

The Government of Jersey said taking on the liability was not "appropriate or necessary".

"Taking on the financial liability for Gibraltar-based insurers would expose Jersey to a remote but significant financial risk, which we do not feel is appropriate or necessary," it said.

"We note that our colleagues in Guernsey have reached the same decision.

"Affected insurers will continue to honour their policies until the termination date, and we believe that there remains a sufficiently competitive market so that anyone who is affected will be able to find an alternative provider."

The Government of Gibraltar said insurance regulations had changed because it was "unfair" for Gibraltarian taxpayers to foot the cost of an insurer going bust in the Crown Dependencies.

It added that the restrictions, which were in effect from 1 September 2023 for motor insurance policies only, were communicated to each of the Crown Dependencies on 16 June 2023.

'Up the swanny'

Chris Bourke, who runs a sports massage business, said his insurance quote from Ross Gower Ltd, which is underwritten by a Gibraltar-based insurer, was originally more than double the previous year.

He said it was later changed to about £475 - still £100 more than last year.

"Some of my clients have very severe mobility issues so they can't come to me personally, I have to go to them," he said.

"My car is very important to me for that so without a car I would be up the swanny."

The BBC contacted Ross Gower Ltd for comment.