Motor-claims costs up 23% in H1 2024 – Central Bank

Figures from the Central Bank show that the cost of settling motor-insurance claims in the first half (H1) of 2024 rose by 23% compared with the previous six months. 

The total of €414 million was also 38% higher than the pre-COVID average for the years 2015 to 2019. 

The figures are contained in the latest report on the motor sector from the National Claims Information Database (NCID). 

A separate report showed that the total cost of claims settled under employers’ liability and public liability in H1 2024 was €144 million. 

This was a 10% decrease compared with the previous six months and 12% lower than the pre-COVID 2015-2019 average.

‘Inflationary environment’ 

The motor-insurance report said that higher damage claims were the main factor in the overall rise in costs. 

Damage-claims costs were 179% higher than the 2015-2019 average, “likely reflective of the high inflationary environment over this period”. 

Damage claims relate to the loss of or damage to property, such as a vehicle, and these are typically settled directly between a claimant and insurer. 

While total injury-claims costs increased by 13% in H1 2024, they were still 16% lower than the pre-COVID average.  

A breakdown showed that the number of damage claims settled in H1 2024 increased by 7% compared with the previous six months and was 32% higher than the 2015-2019 average. 

The average cost of a damage claim increased by 24% in H1 2024 to €3,150. 

Large injury claims 

The number of injury claims settled increased by 10% in H1 2024 but remained 20% lower than the 2015-2019 average. 

For injury claims that settled for less than €100,000, the average compensation cost was down 23% compared to 2020, while the average total cost fell by 13%. 

When including all injury claims, however, the average total cost was effectively unchanged at €38,553.  

“This highlights the contribution of large injury claims towards total claims costs,” the report stated. 

Personal Injuries Guidelines 

During the first half of last year, 2,300 injury claims were settled directly, 791 through the Injuries Resolution Board, and 1,648 through litigation. 

The report shows that 75% of all claims settled in H1 2024 did so under the Personal Injuries Guidelines – including 46% of litigated claims. 

Compared with claims settled under the Book of Quantum in 2020, the average cost of claims that settled under the guidelines in H1 2024 were: 

• 37% lower for claims that settled directly before the Injuries Resolution Board,
• 8% lower for claims settling through Injuries Resolution Board, and
• 23% lower for claims settling directly after the Injuries Resolution Board. 

The Central Bank said that not enough claims had been settled through litigation under the guidelines to provide a consistent comparison.  

Litigated claims account for more than 70% of total injury-claim costs. 

Employers’ and public liability costs 

The report on employers’ liability and public liability showed that total injury-claims costs fell by 10% in H1 2024 and were 13% lower than the pre-COVID average. 

Damage claims accounted for a small portion of overall liability settled claims costs – around 8% of total costs in H1 2024. 

The number of injury claims settled in H1 2024 in the sector was 20% lower than the 2015-2019 average. The Central Bank said that this was “effectively unchanged” compared with the previous six months, at approximately 2,100 claims. 

For injury claims that settled for less than €150,000 in H1 2024: 

• Average compensation cost was down 12% compared to 2020, and
• The average total cost increased by 3%. 

When including all injury claims, the average total cost decreased by 4%. 

During the six-month period, 42% of all employer’s and public-liability injury claims settled under the Personal Injuries Guidelines (22% of litigated claims).