Insurers are coming under fire as liability insurance premiums have risen by 16% over the past year, while claims have dropped by 44%, new figures show.

Insurers were accused of taking businesses for a "ride" regarding the cost of cover, which can run at thousands of euro a year for small firms.

The Alliance for Insurance Reform (AIR) yesterday called on the Government to "get serious" with the industry.

It comes after figures from the Personal Injuries Assessment Board (PIAB) showed that the new Judicial Personal Injuries Guidelines continue to have "a very positive and improving impact on personal injury claims costs".

However, while motor premiums have fallen by more than 10% over the past year, liability cover has risen.

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Peter Boland, AIR director, said: "Liability insurers are pocketing these benefits and it is up to Government to get serious with them to ensure that the benefits are passed on in premium reductions to SMEs, voluntary and community groups, charities and sports and cultural organisations struggling with the costs of staying open."

AIR director and former businessman Eoin McCambridge, from Galway, saw premiums for his previous food hall, deli and restaurant business "shoot up from €17,000 to €102,000 in the space of a few years". He accused insurers of taking liability "policyholders and the Government for a ride and damaging the credibility of the Government's insurance reform programme".

Since the guidelines were introduced last year, the average award has fallen by 38% from January to June. Insurance Ireland chief Moyagh Murdock said: "The reduction of awards is very welcome."

And a spokesman for Insurance Ireland, which represents the industry, said that "we refute the claim that insurers are making gains in the liability market". They continued: "The Central Bank's NCID Report from June 2022... found that the employers' liability, public liability and commercial property markets have been operating at a combined loss over the reporting period, which is concerning and also confirms the challenge in some sectors in retaining existing providers and attracting new entrants into Ireland.

"At present, the balance of the duty of care is tilted against businesses when it comes to commonplace injuries like slips, trips and falls. Not enough personal responsibility is placed on the individual, which means common sense is lacking in too many instances where accidents take place. This is leading to insurers exiting the market and making Ireland an unattractive place to do business compared to many other jurisdictions."

And a spokesman for the Department of Finance said: "The Government has continued to focus on reducing costs for motorists, as well as other groups, through the Action Plan for Insurance Reform.

"The most recent CSO Consumer Price Index data for September 2022 shows that the price of motor insurance fell by 0.5% in that month, and is now 43.1% lower than at its peak in July 2016. The data also shows that the price of motor insurance was 10.4% lower than in September 2021, and this is occurring against an 8.2% increase in prices on average in the year.

"This publication also shows that motor insurance prices are down by 15.2% since the implementation of the Personal Injuries Guidelines in April 2021. The reduction of claims volume and motor average value of awards demonstrated in today's PIAB report demonstrates the positive impact of reforms, which ultimately will benefit insurance consumers."