Why has my Car Insurance premium increased?
So, why has my premium changed? Let’s break it down.
At 123.ie, all customer premiums go into one shared pot, a pot that pays for every claim our customers make. Most customers won’t ever need to make a claim, but when claims do happen, the cost can vary.
Your premium can change from one year to the next for lots of reasons, and many of them are outside of your control. Here are some of the big ones:
- Inflation:
Almost everything needed to fix a car or handle a claim now costs more. This includes car parts and labour. Your car might also need towing or storage while you wait for repairs, and you may need a rental car in the meantime. There can also be extra costs like medical bills or legal fees. That rise impacts on the total cost of claims, and in turn, premiums.
- More claims:
If more people make claims because people are driving more and there are more cars on the road, costs go up. Very heavy traffic and congestion can lead to more car accidents occurring.
-Tax and other charges:
Part of your premium pays for government taxes and for covering uninsured drivers. If these costs change, your premium can change too.
- Updated Claims Patterns:
We check past claims to see who is having more or fewer accidents. We look at things like the type of car, the driver’s age, where they live, and their licence type. If some groups are having more accidents, premiums for similar policies may increase.
-Discounts:
Sometimes premiums go up because a discount you had last year is no longer available .
Some things within your control:
- Changes you make to your policy:
If you change your car or add a driver it can affect your premium. Moving to a new address may also change what you pay.
- Your driving history:
Things like your past claims and penalty points can change your premium.
- Your level of cover and any extras:
Choosing more cover or adding extras usually means a higher premium. And don’t forget… every year both you and your car get a little older. That can play a part too.
Speaking of trends, here’s one to be aware of. While injury claim costs have come down thanks to claims reforms, repair costs have risen—a lot. A few reasons why:
- General inflation across repairs, parts, paint, labour, hire cars, storage and towing.
- Higher‑spec cars: Newer cars often have lots of sensors and tech to help stop accidents. These parts can be expensive to fix if they get damaged.
- Large‑section designs: Lots of newer cars have big one‑piece parts. Even a small bump can mean replacing a large section of the car.
Even careful drivers with no claims may still see their premiums increase. It’s not because of anything they did. They might drive safe, modern cars, but those cars are more complex and expensive to repair. That higher repair cost can lead to higher premiums.
And a reminder, if you have another policy with us, you get a loyalty discount.
Have a quick look at your premium breakdown above to make sure it’s there.
In short…
We’re here to help you understand what is changing and why. If you’re unsure, ask. We’re here to help you figure out what works best for you.