Insurance brokers have called on the Government to clamp down on drivers using foreign insurance policies on Irish roads.
The Irish Brokers Association (IBA) said many such policies were providing inadequate cover to crash victims in the event of an accident.
The IBA represents more than 500 insurance intermediaries in the State.
IBA Director of General Services Stuart Reid said said many non-nationals driving on Irish roads used insurance policies which were sourced from insurance companies in their home countries and they provided cover that was "dramatically lower" than would be the case with Irish insurance companies.
He said Irish firms must provide for a minimum cover of some €30 million for a third party claim. However in Poland that figure is just €1.5 million, in Latvia it is €355,750 and in Lithuania it is just €145,000.
"Historically the number of such drivers on Irish roads was very small but that is now increasing rapidly," he said.
"As a result we're looking at an increasing risk that people involved in accidents involving non-national drivers will not receive adequate compensation from the driver's insurance provider."
Mr Reid said the EU must "revise and accelerate" plans to set a binding minimum indemnity level for all EU countries.
"Currently the EU has issued a directive providing for a minimum indemnity level of €5 million per claim for all European motor insurance policies but this change will not take effect until June 2007.
"Worse still, the directive grants member states up to five years to meet the minimum indemnity level, thus allowing some European states up to 2012 to meet the €5 million minimum limit."
