With trials of driverless car fleets now occupying our national roads, the motor sector is getting an upgrade like never before. As fraudulent claims continue to accelerate and while premiums pay the price, new entrants are causing insurers to tighten their seat belts in the race for consumer loyalty. What is really driving the motor industry today? Michèle Bacchus decided to take a closer look.
Less than 50 years ago it was not uncommon to see three-wheeled cars and vans on British roads; nowadays cars can be plugged in to charge, can warn their drivers of oncoming traffic jams and can even park themselves. But what’s under the bonnet of a modern car, who’s behind the wheel and what happens when it all goes wrong? Post, in association with National Windscreens, conducted some research on the subject and then took the findings to the market for comment.
Between February and March 2017, we invited subscription members of Post together with those who follow the brand on social media to take part in a survey relating to the motor industry. Respondents were given 33 closed questions asked either to rank in order of importance or choose between. Some questions allowed for comment.
This report is based on the results taken from the complete responses of 147 respondents.
Three manufacturers and two bodyshop workers began answering the survey but ceased before the end; their answers have, therefore, not been included. Several car garages were invited to participate but declined.
At the same time as the market survey, Post commissioned Consumer Intelligence to take 12 motor-related questions to the public. A total of 1069 members of the public from across the country submitted responses, which were treated anonymously.
Respondents believe claims frequency has increased by 6% to 10% and the cost of claims has increased by 11% to 20%
“The Institute and Faculty of Actuaries reported in September last year that frequency in 2015 actually fell, so with that in mind, it is perhaps surprising that the results of this research suggest that claims frequency has increased.” Nigel Teasdale, head of motor and fraud, DWF
“A reason why claim costs have increased is because of the failure of many fleets to capture third-party information at the scene of the incident. A failure of the at-fault party to have in place robust policies and well understood procedures for managing third party claims can see costs rapidly escalate if left to the injured person’s own insurer to pursue at a later date.” Paul Holmes, commercial director, Horizon Vehicle Management
The research found credit hire rates were felt to be the second highest reason behind raised motor premiums – higher than fraud, claims management companies, periodic payment orders, bad driving and repair costs. Personal injury rated first.
“We are not about just the cost of repairing bent metal. It’s about ‘doing the right thing’ for fleet customers, which may not necessarily be in the interest of those organisations in the incident claim chain, such as insurance companies and credit hire firms.” Paul Holmes, commercial director, Horizon Vehicle Management
“It is more surprising that credit hire was given as the second highest reason for raised premiums by respondees. While credit hire is a thorn in many peoples’ sides, most insurers have credit hire claims under control, either through the use of protocols or through the use of intervention strategies.” Nigel Teasdale, head of motor and fraud, DWF
More than half of respondents believe manufacturers will take a greater interest in claims, and nearly one-fifth believe manufacturers could control the claim from first notification of loss to resolution.
“Once level 4 automated vehicles start to appear on Britain’s roads within the next five years, the single insurance policy approach will see motor insurers seeking recoveries from vehicle manufacturers for monies outlaid to innocent victims of road traffic accidents where the vehicle responsible for the collision was operating in automated mode.” Peter Allchorne, partner, DAC Beachcroft
“Where there are accidents involving driverless vehicles, then there is a prospect that the accident will have arisen as a result of a vehicle fault, making it essential for the manufacturer to be involved in investigating how the accident took place from the outset and having a need to deal with FNOL.” Nigel Teasdale, head of motor and fraud, DWF
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