UK and Ireland motor claims inflation, September 2026: premiums diverge, repair costs do not

The UK: premiums up, repair inflation down, parts and glass still rising

The Office for National Statistics published September CPI on 21 October. Headline UK CPI rose 3.5% over the year [1]. The motor and claims-related components did not move together.

Vehicle maintenance and repairs rose 3.7% in the year to September, well below the 7.8% (adverse for insurers) reading a year earlier and below the 4.9% average of September readings from 2018 to 2025 [1]. Spare parts and accessories rose 5.1% (adverse for insurers), above their 3.5% average for the same September window [1]. Second-hand car prices fell 3.2% (favorable for insurers), after a 1.1% rise in September 2025 [1]. New cars rose 1.2% [1].

Hospital services rose 4.9%, in line with their recent September average [1]. Medical and paramedical services rose 3.8% (adverse for insurers), above a 3.0% average [1]. Legal services and accountancy rose 4.4%, down from 7.4% (adverse for insurers) a year earlier and close to their 4.9% September average [1]. House contents insurance prices fell 9.5% [1]. That last figure is a price index, not a claims cost, and it matters more for property than for motor.

The Association of British Insurers' Q3 figures, covering July to September, show why a cooler repair CPI is not the whole claims story. UK motor insurers paid out £3.2 billion (adverse for insurers) in the quarter, matching the Q2 record and 8% (adverse for insurers) higher than Q3 2025 [3]. The average claim was £4,900 (adverse for insurers), up 1% (adverse for insurers) on the year [3]. The average windscreen repair or replacement claim was £298 (adverse for insurers), up 5% on Q2 and 9% (adverse for insurers) on the year [3]. The average motor premium paid was £562, £4 lower than Q2, 2% higher than a year earlier in cash terms, and £7 lower after inflation [3].

The ABI collects prices customers actually paid, not quotes. That +2% figure is therefore a different measure from the ONS motor vehicle insurance CPI of +6.8%. Both should be watched, and they should not be treated as the same series.

If payouts rose 8% and the average claim rose 1%, the implied number of claims in the ABI data is about 7% (adverse for insurers) higher than a year earlier. That is an implication from the two published figures, not a separate ABI frequency series [3]. Frequency, not repair CPI, looks like the main reason Q3 payouts stayed at the record level.

Ireland: premiums have started to fall, claims costs have not

The Central Statistics Office published September CPI on 8 October. All-items prices rose 4.1% over the year [2]. Motor car insurance fell 5.0% [2]. Insurance connected with transport, the slightly wider class, fell 4.7% [2]. Insurance connected with dwellings fell 3.0% [2]. Health insurance rose 8.7% [2].

Maintenance and repair of personal transport equipment rose 9.1% (adverse for insurers) over the year, with no change on the month [2]. Second-hand motor cars fell 0.5% (favorable for insurers) [2]. New motor cars rose 0.6% [2]. Health prices rose 1.8% [2].

The Central Bank of Ireland published Private Motor Insurance Report 8, the latest NCID annual report, on 20 October. The report covers 2025, not 2026, but it is the official claims picture behind those 2026 prices [4]. The average written premium rose 4% to €655 in 2025, after an 18% rise from 2022 to 2025. There was a decreasing trend in the last two quarters of 2025, which the Central Bank said is now also visible in the CSO insurance index into 2026 [4][5].

Claims cost per policy rose 10% (adverse for insurers) to €424 (adverse for insurers), the highest since 2014 [4]. Damage claims cost per policy rose to €197 (adverse for insurers), the highest in the series. Injury claims cost per policy was €228, similar to pre-COVID levels [4]. The gross loss ratio fell from 73% in 2024 to 67% (favorable for insurers) in 2025. The gross combined operating ratio was 93%, and 94% net of reinsurance [4]. Operating profit was 7% of total income before interest and tax [4].

The 2025 loss ratio improved even as claims cost per policy rose, because premiums also rose. That is not the 2026 starting point. If the CSO premium index keeps falling while repair inflation stays near 9.1% (adverse for insurers), the damage part of the book will take more pressure in 2026 than the 2025 combined ratio implies.

Injury costs have a different split. For injury claims that settled for less than €100,000, average total cost rose 7% in 2025, and was 5% below the 2020 average. Average compensation was 18% (favorable for insurers) lower than in 2020, offset by a 29% (adverse for insurers) rise in legal and other costs combined [4]. Settlement is still slow in the courts: in 2025, 46% of injury claims settled directly (1.7 years on average), 18% through the Injuries Resolution Board (2.6 years) and 36% through litigation (4.7 years) [4].

Frequency is mixed, not a simple relief

Great Britain recorded 1,538 road fatalities in 2025, down 4% from 1,602 in 2024, the lowest figure outside the pandemic years [6]. Killed or seriously injured casualties rose to 29,918, up 4% from 28,876 [6]. Casualties of all severities were 127,883, broadly unchanged [6]. These are Great Britain police-reported figures, not Northern Ireland or Ireland, and they are not a claims frequency series. They do not support a story that UK motor frequency is simply falling.

What this means for underwriting and claims

Underwriting. UK and Ireland need separate rate adequacy views. A UK book can show rising official premium prices and cooler repair inflation, and still be taking pressure from parts, glass and a higher implied claim count in the ABI data. An Irish book can show falling premium prices and a 2025 combined ratio of 93%, and still be taking pressure from 9.1% (adverse for insurers) repair inflation and a claims cost per policy that is already at its highest since 2014.

Claims. In the UK, the line items to check are parts, windscreen and calibration, and hospital and medical services on injury files, not a headline repair rate that has already cooled. In Ireland, legal and other costs on injury claims under €100,000 are rising even where compensation is lower than in 2020, and damage severity is the part of the account at a series high.