Motor insurance premiums up 4% last year to reach average of €655
There were a total of 133,387 damage claims made during 2025, down from 134,115 in 2024.
Motor insurance premiums increased by 4% during 2025, to an average of €655, as the cost to settle claims ticked up to €753m over the course of the year, data from the Central Bank of Ireland shows.
According to the latest data from the annual private motor insurance report of the National Claims Information Database, there were 2.4m motor insurance policies written in 2025 — up from just under 2.33m in 2024.
The total value of these premiums stood at €1.58bn, up from €1.47bn.
The average premium declined slightly over the course of the year; during the first half of 2025, it stood at €658, and fell to €650 during the second half.
The cost of insurance premiums peaked in 2017 at €721.
The claims cost per policy increased by 10% in 2025, to €424.
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According to the data, the sector took in €1.55bn in “gross earned premiums/insurance revenue” during 2025, along with €83m from investment income — as well as €23m in “other earnings”.
Gross underwriting expenses amounted to €1.43bn during the year, with reinsurance costing €52m, and “other expenses” costing €38m.
The total cost of claims settled last year was €753m across 157,000 claims, resulting in an average cost to settle a claim of €4,729.
In 2024, it cost €746m to settle around 158,000 claims.
The sector’s profit after tax for 2025 stood at €89m.
There were 133,387 total damage claims during 2025, down from 134,115 in 2024.
The average cost to settle these claims was €3,024 last year, up from €2,954 in 2024.
In terms of injury claims, across all channels, it cost on average €36,775, down from €39,329 the year prior, to settle a case last year; however, this is driven up by claims going through litigation, which costs on average €70,149 — which is down from €82,350.
Excluding the claims that were for €100,000 or more, the average cost to settle a case was €24,582. Through the litigation channel, the cost was €40,880.
The Central Bank noted that 60% of premiums received by insurers in 2025 were used to settle claims, while business expenses accounted for a further 36% of the premium received.
The Central Bank said: “The introduction of personal guidelines has shifted the injury claims landscape, resulting in both a reduction in the number of injury claims and a general move towards lower awards.
"This has been offset in recent years by rising damage claim costs, caused by inflation and supply chain issues."
Seána Cunningham, director of insurance at the Central Bank, said their additional research looks into where the premium that consumers pay ultimately goes.
She said: “It shows that the biggest cost for insurers in 2025 is paying out on claims, adding up to 60% of your premium. This is made up of damage claims at 32% of your premium and injury claims at 17% of your premium.
"The remaining 10% is paid out in legal and other costs associated with the claim settlement process.
“The data continues to reflect the positive impact of the personal injury guidelines, with decreasing injury claim numbers and average compensation levels contributing to market stabilisation.”
The Central Bank said 22% of insurance companies' expenses go towards running the business; brokers also receive a commission for attracting and signing up new customers, accounting for 8% of a premium; and there is a cost, of about 3% of a premium, in using reinsurance to transfer and spread risk.
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