Comprehensive insurance premiums rose by an average of 9% to €500 and third party fire & theft (TPFT) premiums saw a 19% increase to €663 in 2015, according to latest data on the sector published by the Central Bank.
Its annual Private Motor Insurance Statistics' report, which is based on figures supplied by Insurance Ireland, also states that the average cost of 'year 1' claims between 2014 and 2015 rose by 10% to €5,776 for comprehensive policies and by 11% to €8,732 for TPFT policies.
It adds that the average cost of 'year 1' claims for comprehensive policies have increased by 45% since 2010 when an average cost of €3,993 was reported.
However, the Central Bank figures show claim frequency fell across both comprehensive and TPFT policies for 'development year 1' in 2015.
The average cost per policy also dropped in 2015 - by 4% for comprehensive and 6% for TPFT.
CEO of Insurance Ireland Kevin Thompson said the "defining issue in motor insurance is the rising cost of claims which is the level of awards and the costs associated with settling them.
He added the reports "show that the amount paid out in claims, in total amounts and average compensation, are increasing as well as the legal and other costs in the claims system.
"For instance, the total amount paid out in motor claims by Insurance Ireland members increased by 23% from 2011 to 2016 while in the same years, the amount paid out by PIAB across all classes of insurance increased by 50%."
However, Fianna Fáil Finance Spokesperson Michael McGrath has questioned the figures provided by the sector on the cost of premiums for the Central Bank report.
Mr McGrath said: "The report claims that average premiums for comprehensive cover rose by 9% in 2015, while third party fire & theft premiums increased by 19%.
"However, the official CSO Consumer Price Index shows that motor insurance premiums increased by a whopping 30.8% in 2015.
"This enormous discrepancy calls into question the validity of the data submitted by the industry.
"As to the reason why premiums have increased dramatically in recent years, the central message from the insurance industry has consistently been that it is all about the number and cost of claims.
"While today's report does show that the average cost of year 1 claims for comprehensive policies increased by 10% in 2015 (and 11% for third party fire & theft), the report also shows that claim frequency has actually been trending downwards since 2008 and fell again in 2015."
Separately, a report from the Cost of Insurance Working Group today has recommended the Department of Finance publish key metrics on the insurance industry on a quarterly basis, beginning with Q2 2017.
The working group's report also recommends the establishment of a National Claims Information Database by the Central Bank of Ireland, which is expected to be in place by Q2 2018.
Minister of State with special responsibility for Financial Services and Insurance Michael D'Arcy said the report is "the start of a process to improve data transparency in the insurance sector and demonstrates the value and need for the National Claims Information Database.
"It is particularly welcome as laying the groundwork for the effective establishment of the National Claims Information Database next year," he added.
Motor insurance premiums have stabilised since the third quarter of 2016, reduced by 8.5% in the year to May.
However, this followed almost three years of price increases which accumulated to a rise of around 70% between 2013 and 2016.
