Insurance companies in Ireland saw premium income rise 32 per cent to £13.95 billion (€17.7 billion) in 2000, according to an annual report on the industry. Of the total, £10.43 billion - or 75 per cent - was generated by life companies, while £3.52 billion was generated by non-life companies.

Business written on a "freedom of services" basis into other European Economic Area member-states accounted for £4.3 billion - or 31 per cent - of the overall business written. This is primarily business conducted by IFSC-based companies.

Following the terrorist attacks on the US in September, the report said it expected an upward pressure on premiums and a decrease in the type and level of cover available in some cases.

Underwriting results in the non-life sector showed that total Irish risk business rose by 22 per cent on the 1999 level to £2.21 billion, while foreign risk rose by 2 per cent to £1.31 billion. The net underwriting result for Irish risk business worsened noticeably on 1999, with a loss of £357 million last year compared with a loss of £201 million in 1999, the report said. Allowing for investment income, the loss for 2000 was £127 million, compared with a profit of £29 million in 1999.

The increased loss on Irish risk business was due primarily to a rise in the cost of claims for motor insurance, the report said. Net underwriting losses for motor insurance amounted to £254 million - 24 per cent of net premium - compared with a loss of £126 million in 1999.

Underwriting losses on liability insurance rose from £76 million in 1999 to £105 million - or 39 per cent of net premium - in 2000. In fire and property insurance, underwriting rose from £14 million in 1999 to £20 million in 2000.

In the life assurance sector, total new premiums written in Ireland showed a rise of 46 per cent over 1999 to £8.63 billion, of which £4.42 billion related to Irish risk business. New single premium business written in Ireland rose by 48 per cent, while new annual premium business rose by 24 per cent in the same period.

Total gross premium income rose by 41 per cent in 2000 to £10.43 billion. Of this, income in respect of Irish risk business amounted to £6.25 billion.

Irish private policyholders of the failed UK insurance company Independent could qualify for protection under the UK Policyholder Protection Act, the report said.