Motor insurance premiums in Ireland are beginning to move lower, offering welcome news for motorists facing rising household and vehicle costs. According to the latest Department of Finance update, premiums fell by 5% in the year to September 2026, while claims-related reforms are also reducing average compensation costs.
Motor insurance premiums show downward trend
Minister of State for Financial Services, Credit Unions and Insurance Robert Troy welcomed the latest National Claims Information Database report, which found that motor insurance premiums started to decline modestly during the second half of 2025.
The figures broadly match Consumer Price Index data from the Central Statistics Office (CSO), showing a 5% reduction in motor insurance premiums over the 12 months to September 2026. The development comes despite continued pressure from inflation, higher vehicle repair costs and increasingly complex car technology.
Key findings from the latest report
- Motor insurance premiums decreased by 5% in the year to September 2026.
- Average compensation costs were 18% lower in 2025 than in 2020.
- Some 88% of personal injury claims were settled under the Personal Injuries Guidelines.
- The guidelines applied to 73% of litigated claims.
- The Injuries Resolution Board continues to offer a faster and less expensive alternative to litigation.
Personal injury reforms help reduce claims costs
The Personal Injuries Guidelines, introduced in April 2021, remain central to the reform programme. Their widespread use across negotiated and litigated settlements has helped create greater consistency in awards and contributed to lower average compensation costs.
The Injuries Resolution Board also plays an important role. It can deliver comparable awards in almost half the time associated with court litigation, while generally involving substantially lower legal expenses. These changes are intended to improve efficiency across the insurance system and support more affordable premiums over time.
New transparency measures for Irish motorists
The Central Bank of Ireland has also published Behind the Data: The Cost of Car Insurance in Ireland. The consumer-focused guide explains how repair expenses, injury claims, market conditions and other factors can influence premiums.
A new Motor Insurance Transparency Code is being introduced with support from the Department of Finance and the Central Bank. It includes:
- A Premium Summary Statement at quotation and renewal.
- An Annual Market Overview Statement explaining wider market trends.
- Plain-language explanations and an online glossary.
- Risk-mitigation guidance for consumers.
- Clearer reasons when applications are declined.
Only around one in four motorists currently shops around for cover, while 76% of those who do reportedly make a saving. Greater transparency may therefore encourage consumers to compare policies more actively.
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What happens next?
The Government’s Action Plan for Insurance Reform 2025–2029 contains 26 measures focused on affordability, competition, transparency, fraud, innovation, climate protection and legal reform. The transparency code is one of its priority actions, and its first review is expected within 18 months.
For drivers, the latest data is encouraging but does not guarantee that every policyholder will see the same reduction. Premiums continue to depend on individual risk, vehicle type, claims history, repair costs and insurer pricing decisions.
Conclusion
The latest figures suggest that motor insurance premiums are finally heading in a more positive direction in Ireland. Lower compensation costs, wider use of the Personal Injuries Guidelines and clearer consumer information could support further progress. Motorists should continue comparing renewal quotes and reviewing cover as reforms develop.
Article/Image Courtesy: gov.ie
