• Insurance industry made an operating loss of 1% on current year claims.
• Average premium per policy was €568 in 2023 after a period of falling premiums from 2017-2022 where premiums decreased by 23%.
• Total claims cost for 2023 €816m across 205,000 claims, representing an increase of €53 million in claims costs on 2022.
• Damage claims annual settled costs were 118% higher than pre-covid average, while number of settled damage claims was 24% higher
• High number of personal injury claims still being settled through litigation eroding real impact of Personal Injuries Guidelines and other Government reforms.

Insurance Ireland today welcomed the 6th NCID private motor insurance report, which shows that the average written premium on private motor rose by 2% to €568 in 2023, after a period of falling premiums from 2017-2022 where motor premiums decreased by 23%. This come against a backdrop of inflation in the rest of the economy where the average figure for inflation in 2023 was 6.3% (CSO), demonstrating Government’s reform agenda and insurers have insulated consumers.

However, the trend of significant increase damage claims costs continued, and the use of litigation to settle personal injury claims continues to erode the impact of reforms. A number of factors are feeding into the increase in damage costs, including the impacts of inflation on the cost of repairs and the deterioration in road safety which is leading to more fatalities and collisions on our roads.

Moyagh Murdock, CEO of Insurance Ireland, said: “Today’s figures published by the Central Bank reaffirm that insurers followed through on their commitment to pass on the benefits of Personal Injuries Guidelines and other reforms to consumers. Although premiums have begun to increase, reflecting the increased cost environment, Irish motor insurance customers have benefitted from significant decreases from 2017 to 2022, where premiums decreased by 23%.This demonstrates that consumers have been cushioned from the impact of the significant cost inflation of the last couple of years.”

Moyagh Murdock continued “However, there are concerns emerging. The Industry made an operating loss of 1% on current year claims in 2023 and the cost environment has increased in relation to the volume and cost of damage claims in particular, reflecting both high cost inflation and the increase in collisions on our roads. The trend of settling claims through the more expensive litigated route also continued to add significant cost to the claims environment, with legal costs disturbingly high. The average legal cost for litigated claims increased in 2023 and was 18% higher in 2023 compared to the 2015-2019 average. For litigated claims that settled for less than €100,000 in 2023, legal costs made up 46% of the total claim cost (or 89% of the compensation cost) on average. This is despite the fact that it doesn’t add to the levels of awards the claimant receives via either the Injuries Resolution Board process or directly settling claims with insurers. This further highlights the role of the Injuries Resolution Board to increase settlements though mediation and without unnecessary litigation is critically important.”

24th October 2024