Insurance companies made less profits from motor insurance premiums in 2005 compared to the previous year, according to statistics from the Financial Regulator.
The statistics are compiled to examine the level of accident frequency and claim costs, and their impact on premiums paid by different categories of drivers.
Mary O'Dea
Average surplus per policy for comprehensive cover fell by 23 per cent, while third party, fire and theft surplus dropped by 13 per cent.
Lower premiums paid by drivers are the main reason for the falling profits, according to the statistics.
Following a sharp decline in accident frequency between 1997 and 2003, an increase was reported in 2004, and this upward trend has continued into 2005 for both categories of cover.
Accident frequency in 2005 has returned to close to 2002 levels, with 6.7 accidents per 100 policies for comprehensive cover and 4.9 accidents per 100 policies for third party fire and theft cover.
Claims were settled more quickly in 2005 than in the previous year. The percentage of costs finalised one year after an accident increased to 44 per cent in 2005 from 39 per cent in 2004 for comprehensive cover, and to 32 per cent from 24 per cent for third party fire and theft cover.
The statistics also indicate that the Personal Injuries Assessment Board, which had its full first year of operation in 2005, may have had a beneficial impact on the speed of settlements.
"It is clear that the PIAB . . . may be having a positive impact on the Irish insurance market. The 2005 statistics show that claim costs are settling quicker and at a lower cost which is a welcome development for consumers," according to Consumer Director Mary O'Dea