There's been a significant increase in the frequency and the cost of personal injury claims in the insurance industry, according to a review by the Central Bank.
The Central Bank’s review of bodily injury claims also found that the number of claims building up within the system is increasing for a number of insurers, as their claims are taking longer to settle fully across private motor and liability lines.
The review points to an increase in the average cost per claim of 8% in private motor claims over the two year period covering 2013 and 2014.
The increase in cost per claim in the employer liability sector was of the order of around 27%, while in the public liability sector, the increase was around 8%.
The increase in the frequency of private motor injury claims in 2014 ranged from 4 to 12% across the sector, with an average of 8.3%.
Sylvia Cronin, Director of Insurance Supervision, said that the non-life insurance industry was facing a number of challenges from legislative changes and the economic environment.
"Increasing court awards, economic activity and increasing numbers of vehicles on the roads are some of the factors pushing up insurance claims in Ireland.
"This uncertainty has increased further due to recent developments such as court awards and other legislative changes, including the proposed introduction of Periodic Payment Orders."
She also pointed out that some companies were holding half the level of reserves compared to others for motor injury claims.
"Overall, it seems that the money set aside for private motor claims by some companies is approximately half the level per vehicle compared to others for more recent accident years. While there are valid reasons for some of these differences, companies need to carefully consider the extent to which these differences are appropriate," she concluded.
