High number of claims in Ireland means another insurance hike

High number of claims in Ireland means another insurance hike

Prepare your wallet for another lashing by motor insurance companies as premiums are set to rise again next year.

Premiums have gone up by a staggering 20 per cent so far this year and are expected to keep on climbing, according to Conor Faughnan of AA Ireland.  

This is reportedly down to an increase in the number of claims being made annually. 

Insurance company Axa reports that it has seen a rise in the frequency of claims from drivers, while official figures for April show that premiums have shot up by up to 16 per cent in the past year.

AA Ireland, which is also an insurance broker, said its own calculations showed that rates were up by 20 per cent.

The Injuries Board, a State body which was set up to help people avoid using lawyers and going to court, confirmed that it was seeing more claims.

“We are seeing single-digit increases across a range of claims we have received to date this year – probably due to increased economic activity – more people at work, more vehicles on the roads etc.”

The Injuries Board spokesman told the Irish Independent that increased economic activity should also mean an increase in the number of policies sold, which should offset the higher number of claims.

However, insurers are continuing to make losses on motor policies.

This is in part to do with motoring claims becoming more expensive to settle, according to AA Ireland’s Conor Faughnan.

Mr Faughnan said that an increase to €60,000 in the value of claims that can be made through the Circuit Court was prompting more people to reject settlements from the Injuries Board and take the case to court.

The Injuries Board doesn’t award costs to lawyers but claimants are free to reject the settlement and take the case to court.

Mr Faughnan said that insurance companies were facing mounting pressure from the Central Bank to bulk up their reserves to meet more claims.