Insurance premiums and profits both rose in 2022

Central Bank figures show that the average cost of insurance premiums for employers’ liability (EL), public liability (PL), and commercial property rose by 8% in 2022.

The statistics come from the National Claims Information Database (NCID), which stores information on the cost of non-life insurance claims.

The 8% increase refers to insurance packages that cover a combination of employers’ liability, public liability, and commercial property under a single policy.

These accounted for 86% of all policies sold in these sectors in 2022.

The figures show that just under one-quarter of injuries claims made in 2022 were settled under the Personal Injuries Guidelines (the guidelines), which took effect in April 2021. The remainder were settled under the Book of Quantum.

PIAB claims

The report shows substantial falls in the average cost of injury claims settled directly or through the Personal Injuries Assessment Board (PIAB) under the guidelines, when compared with claims settled under the previous system in 2020.

Employers’ liability and public-liability claims settled through PIAB were both down 33%, while the average cost of public-liability injury claims settled directly dropped by just over 40%.

PIAB has since been renamed as the Injuries Resolution Board.

The report stated, however, that there had not been enough claims under the guidelines to assess their impact on claims settled through litigation, which accounted for 73% of settlements in 2022 (70% before a court award; 3% after).

By cost, litigation accounted for 90% of injury claims.

Average settlements

For employers’ liability claims, the average settlement under litigation was €70,297, compared with €26,366 under PIAB. For public liability, the figures were €37,045 and €21,439, respectively.
Total claims costs for the three types of insurance in 2022 were €517 million – up from €436 million in 2021.
The Central Bank said that the increase might be partly due to the high-inflation environment in Ireland in 2021 and 2022.
“Similarly, ultimate claim numbers in 2022 are higher than they have been in recent years, which likely reflects increased business activity following the removal of the COVID-19 restrictions of 2020 and 2021,” the report added.
Since 2019, the average cost of claims has increased by 34% to €38,446 for employers’ liability, and by 44% to €20,979 for public liability.

Profits rising

The figures show that insurers’ profitability in the areas covered by the report has improved in recent years, with operating profit of 4.2% of income in the years from 2020 to 2022. This followed a loss-making period from 2015 to 2019.

The Central Bank said that 2021 and 2022 were the first years since 2011 that the industry had recorded a material profit.

The report shows a sharp rise in profits from employers’ liability – up from 6% of income in 2021 to 19% in 2022. Profits from public liability were stable at 15% of income, while the figure for commercial property rose from 7% to 10