Ireland motor injury claims still exceed UK levels by over 50%

The report from the Society of Actuaries in Ireland found that legal costs in Ireland are increasing

Whiplash awards in Ireland remain dramatically higher than in the UK, with the gap most pronounced for shorter injuries.

Insurance companies in Ireland are paying out an average of €70 more on claims than those in the UK for the same injuries.

A new report from the Society of Actuaries in Ireland (SAI) shows that despite the introduction of the Personal Injuries Guidelines in 2021, the average cost of a third-party claim is still more than 50% higher than the corresponding level in the UK. 

In 2024, they found the claims cost per policy was €205 in Ireland, compared with €135 in the UK.

A 2018 report, the last time UK and Irish insurance compensation payouts were compared, found settlements in Ireland were three times larger than those in the UK. The new report found that while the gap has narrowed slightly, the difference in legal fees is increasing. 

The Personal Injuries Guidelines aimed to transform personal injury and compensation payouts and have resulted in a significant reduction in payouts. However, the UK has carried out similar reforms, which have meant the gap between the two jurisdictions has been largely maintained.

Whiplash awards

The report found that whiplash awards in Ireland remain dramatically higher than in the UK, with the gap most pronounced for shorter injuries. For a whiplash injury that clears up within three months, an Irish claimant can expect an award of €1,750, compared with just €281 in England and Wales, a difference of 532%. 

Even at the upper end of the scale, where an injury takes up to two years to resolve, Ireland's award of €9,000 is still 82% higher than the €4,932 in England and Wales. They introduced a statutory whiplash tariff in 2021 that set fixed payments based on how long injuries lasted, with no associated legal costs. 

In Ireland, whiplash claims are assessed under Personal Injury Guidelines, which give significantly more headroom. 

The UK tariff has also had an effect on claim volumes, with the number of whiplash claims reported in England and Wales falling from around 36,000 in 2020 to approximately 26,000 in 2023. 

In Ireland, claim frequency has been moving in the opposite direction since 2022.

"For every motor policy, Irish insurers are paying out roughly €70 more on average to cover the higher costs of injury claims relative to the UK," chair of the Society of Actuaries’ Working Group Noel Garvey said. 

The Working Group is made up of representatives from the main domestic insurance firms in Ireland.

"In 2024, the average settlement cost per Third‑Party Injury (TPI) claim, for claims lower than €100k in Ireland, was €23.2k. By comparison, the average settlement cost per TPI claim that settled for less than €311k in the UK was €9.6k."

Mr Garvey said that compensation awards are a significant component of claims costs, but claims frequency, legal costs, fraud controls and market competition also materially influence pricing outcomes.

The report found that legal costs in Ireland are increasing, and unlike compensation levels, the gap with the UK is getting worse. Half of all compensation payouts are not made up of legal fees. 

When an injured motorist settles a claim in Ireland, their legal fees are on average 2.8 times higher than the equivalent cost in the UK, this is up from 2.5 times in 2018.