The average motor-insurance premium fell by 7% to €568 between 2021 and 2022, according to new figures from the Central Bank.

The Private Motor Insurance Report of the National Claims Information Database (NCID) also shows that the average cost of a damage claim rose by 20% last year.

The average cost of damage claims was up by 35% since 2020, according to the Central Bank.

Damage claims now make up 46% of settled claims costs – up from 30% in 2021.

Cost of claims

The figures show that half of all injury claimants settled under the Personal Injuries Guidelines – up from 16% in 2021.

The report says that 85% of claims that were settled directly, before going to the Personal Injuries Assessment Board (PIAB), last year were settled under the guidelines.

Three-quarters of claims settled through PIAB did so under the guidelines, but the figure for claims settled through litigation was just 6%.

The Central Bank said that the average cost of claims under the guidelines, compared with those settled under the Book of Quantum in 2020, was 47% lower for those settled directly before PIAB, and 32% lower for those settled through PIAB.

Litigation channel

Referring to the impact of the guidelines, Robert Kelly (Central Bank director of economics and statistics) said: “Significant reductions in average claim costs are seen in the direct and PIAB channels.

“However, it is still not possible to determine the impact of the guidelines on claims settling through litigation, due to the small number of claims settling through this channel. This is important to note as 77% of all injury costs were associated with litigated claims,” he added.

The report shows that motor-insurance firms earned €1.3 billion from premiums last year. Overall operating profit in the sector was 12% of total income (a figure which includes investment income).