The average cost of a motor insurance policy increased by 9% (€49) during the first half of last year, when compared with the first six months in 2023.
Latest figures from the Central Bank’s National Claims Information Database show that the average premium increased from €567 to €616 over the period.
This compares with an average annual premium of €315 across the European Union.
Despite the rise, the cost of motor insurance is still around 25% lower than the peak in 2017, but has been steadily rising since 2022.
Average premiums fell by 25% between the second half of 2017 and the same period in 2022, however, since then they have increased again by 12%.
According to the NCID, between January and June of last year, there were almost 1.2 million new motor insurance policies, which accounted for €729 million in premiums.
The figures also show that the proportion of consumers opting for comprehensive insurance cover (as opposed to just third-party cover) continued to increase in the first half of 2024, making up 93% of all policies and is up from 80% in 2009.
Commenting on the figures, Insurance Ireland chief executive Moyagh Murdock said that “although premiums have begun to increase, reflecting the increased cost environment, Irish motor insurance customers have benefitted from significant decreases.
“Aside from inflation, there are issues still to be addressed which would take further cost out of the claims environment. The trend of settling claims through the more expensive litigated route continues to add significant cost, 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.”
Ms Murdock added: “We also note that this is a mid-year report, and we look forward to the full report which will give a broader view, reflecting not just premium costs but also the cost of insurance claims, which have been increasing.”
Insurance Ireland also said that the Judicial Council’s proposed 16.7% increase in the personal injuries guidelines is “concerning as it may erode the progress made by the Government’s Insurance Reform agenda”.
Alliance for Insurance Reform Chief Executive Brian Hanley said the “sharp rise” in premiums highlighted in the Central Bank’s report will be no surprise to consumers.
Mr Hanley added: “Set against this, how can the Government justify taking steps that will drive the cost of people’s car insurance even higher? The Minister for Justice, Jim O’Callaghan, is currently considering a recommendation from the Judicial Council that personal injury awards be increased by almost 17% in the coming weeks.
“Notwithstanding that awards are higher here than in most other countries and the relatively short time the current award guidelines are in existence, if adopted it will lead directly to even greater increases in policyholder premiums. Motorists, businesses, sporting, community and voluntary groups simply cannot afford for this to happen,” he added.
Article Source – Motor insurance costs rose by 9% in first half of last year – RTE
