Latest statistics reveal that motor insurance premiums in Ireland have risen by a staggering 42% in the last number of years despite a decrease of 2.5% in the average cost of claims per policy.
The data is contained in the Central Bank’s First Private Motor Insurance Report of the National Claims Information Database which was set up following a recommendation made in 2017 by the Cost of Insurance Working Group.
The data also shows that motor insurers made an operating profit of 9% in 2018, at a time when the industry was crying wolf about the apparent rising cost of claims and the effect this was having on profitability and ultimately insurance premiums.
The data further shows that between 2009 and 2018 the number of insurance claims fell by 40% reducing the average costs of claims and leading to increased profits for the insurers. While during the same period motor insurance premiums rose by a staggering 42%.
This is difficult to take, particularly when insurance companies consistently blame the number of claims being made as the reason why premiums are so high. The simple truth is that insurance companies wish to maintain significant profits in this sector.
The Alliance for Insurance Reform has reacted with anger to the Central Bank’s Report and its members are demanding immediate reductions in motor insurance premiums to sustainable levels.
The database also provides valuable new data on how motor claims are settled. More than half (53%) of claims between 2015 and 2018 were settled directly between the insurer and the claimant which is a worrying statistic. Anyone considering pursuing a motor claim or personal injury claim should seek legal advice to protect their interest and ensure they are treated fairly when it comes to being properly compensated.
It is worth noting that directly settled claims led to an average compensation payout of a little over €11,500, while claims that settled though the Personal Injuries Assessment Board (PIAB) averaged a little over €22,500.
However, claims settled though litigation led to average compensation of over €45,000.