The Government is to set up a commission to examine compensations awards for victims of motor collisions amid concerns about escalating insurance costs.

The development comes as the British government has proposed reducing awards for minor whiplash injuries to €500.

In Ireland, victims of similar injuries can be awarded between €16,000 and €20,000.

Earlier this year Minister for Finance Michael Noonan established a working group which is chaired by Minister for State Eoghan Murphy.

It is due to report next month.

In an interview with RTÉ News Mr Murphy said he had presented a list of emerging recommendations to Mr Noonan.

He said it would cover a variety of areas including transparency, data sharing, fraud, uninsured drivers and the cost of awards.

"There is a lot of data out there as to the awards in other jurisdictions...it does seem to be we may be an outlier in terms of personal injury claims particularly at the lower end,” said Mr Murphy. “It is something that the working group has been looking at over the past number of months."

He added that there may be "the need for a new body or entity to look at what is happening here in terms of international comparisons and what we can do on the Government side".

Earlier, the chief executive of Insurance Ireland has said whiplash injury claims are a major contributor towards the cost of claims, feeding through to premiums.

Speaking on RTÉ's News At One, Kevin Thompson said whiplash accounted for 80% of all motor injury claims.

He said over the past 18 months, Insurance Ireland has been calling for the level of personal injury awards to be benchmarked internationally, saying the average award here is €16,000 compared to €5,000 in the UK. 

Mr Thompson said at the upper end of whiplash claims, there can be an award of €78,000 compared to the UK figure of €24,000.