Motorists in Ireland faced higher average private car insurance costs across 2025, even as premiums began easing in the year’s second half, according to the latest annual claims database report. The distinction matters: the annual increase does not mean prices rose continuously throughout the year, while the later decline does not erase the full-year rise.
The report records an average premium of about €655 in 2025, up 4% on 2024. The average had fallen from a 2017 peak of €721 to €557 in 2022, before rising 16% over the next three years. In the second half of 2025, premiums were 0.4% lower than in the first half. The figures describe different comparisons and should not be conflated into a claim that insurance became cheaper over the year as a whole.
A separate, more recent consumer-price measure points to further easing: government figures citing the latest Consumer Price Index show motor insurance premiums were 5% lower in the 12 months to September 2026. That is a year-on-year measure of price change, not a revision to the 2025 average premium recorded in the annual claims data. Individual renewal prices can also differ from a national average, so the broad trend does not establish what any one driver will pay.
Claims absorb most of the premium
The breakdown of 2025 premiums illustrates why the price cannot be explained by a single factor. Around 60% of premium income went towards claims: damage claims represented 32%, injury compensation 17%, and legal and other claim-settlement costs made up the remainder. The published figures distinguish 9% for legal costs and 1% for other claim costs. Operational expenses accounted for 22%, broker commissions for 8%, reinsurance for 3% and contributions to the Motor Insurers’ Bureau of Ireland for a further 3%.
After insurance-related costs, the underwriting result was about 4%. Including investment income and other relevant items, insurers’ operating profit before interest and tax was 7% of total income. These are separate measures: the underwriting result is not the same as overall operating profit. The analysis also simplifies the picture by focusing on premium income and insurance activity; it does not mean every euro paid by an individual customer is allocated in precisely these proportions.
Damage claims are an increasingly important pressure. Their average cost per policy reached €197 in 2025, the highest level in the database series, while the average cost of settling a damage claim rose 2% to €3,024. The annual analysis links repair costs to factors including parts availability, vehicle technology, labour and the time a vehicle remains under repair. It reports that overall claims costs per policy rose 10% to €424 in 2025, primarily driven by damage claims.
Injury figures move differently
Personal-injury measures show a different trajectory. Average compensation was 13% lower than in 2019, and the number of injury claims had fallen 20% over that comparison. The personal-injury guidelines, introduced in 2021 and implemented more fully from 2022, are one part of that context. The data do not establish that the guidelines alone caused every change in claims or premiums.
Legal costs remain material, particularly where injury claims are litigated. For claims below €100,000 settled in 2025, the Central Bank’s consumer analysis puts average legal costs at about €20,000 for litigation, compared with about €800 through the Injuries Resolution Board. Average compensation in that category was broadly similar across the two routes. The figures are averages, not a guarantee about the duration, cost or outcome of an individual claim.
The reports offer a detailed account of how market-wide costs and claims developed, rather than a promise that every household will see a lower renewal quote. The annual rise, the late-2025 moderation and the subsequent consumer-price decline each describe a distinct period and measure. Taken together, they show a market where headline premiums have started to ease from recent increases, while damage-claim costs remain elevated and the balance of claims, expenses and income continues to shape prices.
