The Irish insurance market made a net operating profit of €183m (£130m) in 2002, according to the Irish Insurance Federation (IIF).
The profit represents a significant turnaround in the fortunes of the IIF's 12 motor insurers, who experienced cumulative losses of €200m (£141m) between 1999 and 2001.
IIF chief executive Michael Kemp said: "The 2002 results are good news for policyholders and insurance companies alike. Motor insurers have just come through their worst business period in recent history, but now, all going well, we should be looking forward to a period of premium stability - or even deflation - for motorists.
"In this improved commercial environment for insurers, a number of companies have been able to freeze or reduce motor insurance premiums - we estimate that premiums now are, on average, about 6% down on this time last year."
