The average cost of motor insurance in Ireland rose by 9% between 2023 and 2024, reaching €623, according to the latest report from the Central Bank.
The regulator said the average expected cost of claims per policy increased by 3% to €397 — the highest level recorded since 2014. The report identified the primary driver of the increase as a rise in damage-related claims, particularly vehicle repairs, which reached €192 per policy. In contrast, injury claim costs remained below pre-pandemic levels at €205.
The Central Bank noted that while smaller injury claims have fallen in recent years, this has been offset by an increase in the cost of larger injury claims, leaving overall injury-related costs stable between 2022 and 2024.
Operating profits for insurers have also narrowed, falling to 4% of total income in 2024, compared with 8% in 2023 and 12% in 2022.
Robert Kelly, the Central Bank’s Director of Economics and Statistics, said: “In 2024, damage claims accounted for 54% of settled claim costs, a significant increase from the 29% average observed between 2015 and 2021.” He added: “The total cost of injury claims settled in 2024 was 16% lower than the average from 2015 to 2019.”
The Alliance for Insurance Reform criticised the rising premiums, arguing they are adding pressure to households already struggling with the cost-of-living crisis.
Its Chief Executive, Brian Hanley, told RTÉ’s Morning Ireland that repair costs are the key factor. “We have seen in other countries, including our nearest neighbours, increases in motor premiums — and that again is due to repair costs because of supply chain issues and the cost of labour and so on,” he said.
However, Hanley also noted progress from recent reforms. “The personal injury guidelines have seen the awards stabilise and indeed bring them down more into line with other countries. Today’s report shows that awards have come down by about 25% in recent years.”
Board member Ivan Cooper stressed that more progress is needed: “Notwithstanding the increasing cost of vehicle repairs, injury claims account for more than half of the overall cost of settling motor claims, and we urgently need to see more claims settling at the Injuries Resolution Board.”
Insurance Ireland, which represents the insurance industry, pointed to high legal fees as a major concern. Its Chief Executive, Moyagh Murdock, said: “The overall claims environment is being undermined by persistently high legal costs and longer litigation settlement timeframes.”
She added: “In 2024, legal costs for litigated claims were 27% higher than the 2015–2019 average, with legal fees making up 48% of the total cost for claims under €100,000. Frustratingly, for both consumers and insurers, this offsets the benefits of lower compensation awards under the personal injuries guidelines.”
Minister for Financial Services Robert Troy acknowledged the challenges, saying “costs in relation to damages have increased in the last 12 months and that has eroded some of the gains made thanks to the personal injuries guidelines introduced a number of years ago.”
Speaking on Morning Ireland, he said the latest action plan has strengthened the Injuries Resolution Board, leading to a rise in the number of claims being processed through it. “We can see that more claims are now going through that system,” he said, adding that “we now need to build on those reforms.”
