The cost of car insurance increased by 31.1% in the year to December, according the latest Consumer Price Index from the CSO.

A review of insurance premiums - in particular motor insurance - is under way at the Department of Finance to determine the reason for their increase, according to Minister for Finance Michael Noonan.

Fianna Fáil's Finance spokesperson Michael McGrath called on the minister to re-constitute the Motor Insurance Advisory Board, which he said was previously successful in reducing motor insurance premiums.

Mr Noonan acknowledged there are issues that need to be addressed, however, he pointed out that neither the Central Bank or the Department of Finance could influence the pricing policies of insurance companies.

He said while he would not be reinstating the insurance advisory board, he would see what advice was given following the Department's review, which he said should be completed within months.

Meanwhile, speaking in the Seanad Sinn Féin Senator Trevor Ó Clochartaigh raised the issue of excessive insurance premiums for young people and for owners of older cars.

He said young people were been penalised and they tend to drive older cars, adding the area needs huge scrutiny.