Press release
Ministers Donohoe and Fleming welcome publication of Central Bank report on private motor insurance
Published on
Last updated on
Published on
Last updated on
The Minister for Finance, Paschal Donohoe TD, and Minister of State with special responsibility for Financial Services, Credit Unions and Insurance, Seán Fleming TD, welcome the publication of the second National Claims Information Database (NCID) report on private motor insurance (‘Private Motor Insurance Report 2’).
Commenting on the contents of the NCID report, the Ministers said:
“We would like to thank the Central Bank for this report. Significantly, we note that the Report confirms the downward trajectory in motor premium prices continues – down 9 per cent from their recent peak in 2018. This reflects a lot of work in recent years on insurance reform. On award levels it indicates there is not a large difference between claimants who use the Personal Injuries Assessment Board (PIAB) process versus those who pursue claims through litigation, with the latter experiencing much higher legal costs and longer settlement times. Therefore, the facts presented here should encourage claimants to utilise the more efficient PIAB process to avoid increased legal costs which are ultimately passed onto consumers.
Increasing transparency is a key facet of the Programme for Government commitments. Like the first NCID report on private motor insurance last year, it will prove to be a valuable asset for data transparency in the insurance sector, which should ultimately benefit consumers. Increased data availability allows insurance firms to plan for costs into the future, which in turn should provide stability in relation to premium prices.
The Government recently established a Sub-Group on Insurance Reform within the Cabinet Committee on Economic Recovery and Investment. This Sub-Group is currently preparing an Action Plan on Insurance Reform to be published before the end of the year and will involve a ‘whole-of-Government’ approach to implement the necessary insurance reforms. The data provided by the NCID will be examined and utilised by the Sub-Group as it carries out its work.”
Finally, the Ministers welcome that the Central Bank has also expanded the scope of the NCID to include certain forms of insurance relevant to businesses (employer and public liability and commercial property insurance). Work has begun in collecting the relevant data and the Central Bank intends to publish the first such report in the first half of 2021, with further reports being published on an annual basis.
ENDS
Notes to Editors:
The Report has been published by the Central Bank of Ireland, as required under the Central Bank (National Claims Information Database) Act 2018. The NCID is intended to facilitate a more in-depth analysis of annual trends in insurance claims. This was seen as key to developing an understanding of how claims costs are impacting premiums, in particular understanding the relationship between the price paid by a customer for motor insurance and the cost to insurance undertakings.
Among key points, the Report notes that between 2009 and 2019:
More specifically, between 2018 and 2019:
In terms of Injury Claimant Settlements between 2015 and 2019
Of the claimants who settled injury claims through litigation during 2015 to 2019, 85% settled for less than €100K. For these claimants the average compensation was €23,572 and average legal costs were €14,949.
The new data collected for this report shows us that for claimants who settled injury claims in 2019