The The Australian Prudential Regulation Authority (APRA) has released its General Insurance Claims Development Statistics publication detailing emerging trends in compulsory third party (CTP) insurance.
The findings?
The estimated total cost of claims in CTP insurance has increased over the past five years and exceeded increases in premium revenue.
In fact, premium revenue has seen a 37 per cent surge from 2010 and 2015.
For the record, this number exceeds the 12 per cent increase in insured vehicles over the same period.
In addition, the report details that the ultimate cost of claims has risen by 73 per cent between 2010 and 2015.
Over the past 10 years, actual claims costs have been lower than initial estimates, which means provisions could be released from insurers' CTP reserves.
A major factor of industry profit over the past five years reportedly lies in CTP reserve releases from prior accident years.