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Personal injuries now account for 75% of all motor claims costs

Written by Robert McHugh, on 16th Dec 2019. Posted in Financial

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A new report from the Central Bank shows that personal injury and damage inflation is the main challenge for the sector over the past ten years.

In the years 2009-2013, claims costs reduced by 14% and premiums reduced by 13%. The average cost of settling injury claims increased by 18% between 2015 and 2018 (across all channels).

In 2018 injury claims accounted for 8% of claim numbers but 75% of claims costs, while, the report shows 64% increase in average cost per claim from 2009-2018

Furthermore, falling claims cost per policy over 10 years was driven by falling frequency not reducing costs (Cost of an injury and damage claim up by 64%)

Commenting on the report, Interim CEO of Insurance Ireland, Gerry Hassett said, "The experience of the market in recent years has been defined by volatility and uncertainty. Injury cost inflation remains a major challenge and this is also impacting on the Employers’ Liability and Public Liability markets. The findings of the National Claims Information Database are clear: claims costs are the key cost in the motor insurance market."

He added, "The policy focus on reforming our personal injury award levels is critically important to address these costs. In addition, the legal fees of 63% of compensation in litigated cases under €100k is a significant concern and underlines the need for these costs to be tackled."

Source: www.businessworld.ie

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