· According to Central Bank’s NCID data for 2022, Average motor premiums have continued to fall with motor premiums fallen by 20% in the 5 years to the end 2022. The average premium was €568.
· The reductions show that the Government’s Action Plan for Insurance is working, and the insurance sector is delivering on its commitments to pass through savings to customers, with averages premiums now over €140 lower than 5 years ago.
· Reduction in motor premiums have also cushioned customers in Ireland from the impact of rampant inflation that has driven significant premium increases in motor premiums across Europe and the UK.
· Claims costs have increased and returned to pre-covid levels. Damage claims now a larger component of overall claims costs. 46% in 2022 v below 30% of settled cost pre-covid.
· In total, 134,000 claims were settled in 2022, with insurers paying out €548m.
Insurance Ireland today welcomed the latest National Claims Information Database (NCID) report on motor insurance from the Central Bank of Ireland, which shows a 20% reduction in motor insurance premiums over the past 5 years. It is also very positive to see that the level of comprehensive insurance cover with policy holders has increased from 84% to 91%.
This points to the fact that the Government’s insurance reform agenda is working, and insurers have been delivering the benefits back to consumers. Insurance Ireland consistently advocated for and supported the insurance reform measures introduced by Government.
The NCID report shows the average motor premium in 2022 was €568. In total, 134,000 claims were settled, at a cost of €548m. Of the €548m that was paid out, 54% related to injury claim costs while 46% related to damage claim costs a significant increase on pre-covid years. The report shows that there was an increase in the number and cost of damage claims during 2022 compared to previous years, and a decrease in both the number and cost of injury claims. However, overall claims frequency increased by 20% in 2022, and is now similar to the pre-COVID levels in 2019.
Moyagh Murdock, Chief Executive of Insurance Ireland said “It’s great to see the positive impact of the Government’s reform agenda helping the sector to deliver benefits to the customer. We believe it is the combination of the reforms and prudent cost management on the part of the insurers that is enabling this benefit to be fed through, delivering stability to motor insurance customers at a time when they are dealing with very high levels of inflation in almost every other aspect of their daily lives. The average motor premium in Ireland is currently €568.
Moyagh Murdock said “It is disappointing, however, to see the NCID report showing damage cost inflation as this offsets to some extent the reductions in injury costs, especially when combined with the deteriorating situation on our roads in terms of increased numbers of serious collisions. The report also shows the cost of claims going back to pre-Covid levels.
On the other side of the equation, we have yet to see the full impact of some of the reforms feeding through, for example, the Personal Injuries Guidelines will take time to feed through to the litigation system, as will the strengthening of PIRB’s powers and the recently implemented changes to the Duty of Care. Only 15% of the injury claims were settled through PIRB with 48% being settled directly with insurers and 37% through litigation. Litigated claims account for 78% of the overall cost which is adding too much unnecessary cost into the system. It is also much faster to settle injury claims through PIRB taking on average 2.7 years to settle claims versus 4.8 years through litigation.