Sharp decline in claims and payouts
The Association of British Insurers has announced that motor claims fell 48% in the second quarter of 2020, with claim payouts also down.
It reported that there were 324,000 new claims in the second quarter of the year compared to 678,000 received in the previous quarter, while the value of claims was down 5% to £2.1bn.
Meanwhile, the value of the average claim paid jumped 27% on the previous quarter to £4,600, the largest quarter to quarter rise on record, and the average value of personal injury claims notified leapt by 34% to £19,500.
The figures come as the average price paid for comprehensive motor insurance at £460 currently stands at a four-year low.
Laura Hughes, ABI’s manager, general insurance, said: “Lockdown naturally led to far fewer vehicles on the roads, which is reflected in the fall in the number of motor claims. With the average price of motor insurance currently at a four-year low, insurers have been passing on cost savings to their customers.
“However, cost pressures remain, such as rising vehicle repair costs, reflecting ever more complex vehicle technology and increased vehicle theft. With personal injury costs also continuing to rise, it is important that the whiplash reforms scheduled to be implemented in April 2021 are not delayed further.”
