By Ranamita Chakraborty
The number of motor insurance claims notified to UK-based insurers in the second quarter of the year fell as expected according to recent figures from the Association of British Insurers (ABI).
The fall largely reflected the COVID-19 lockdown period, when far fewer vehicle journeys were made across the UK. Concurrently, claim pay-outs during the period were also down but fell at a lower rate.
There were 324,000 new claims in 2Q2020 which signified a 48% decrease from the 678,000 claims received in the previous quarter.
The value of claims settled during the period, which includes existing claims from previous quarters, also fell, but at a much slower rate than the number of new claims. In the most recent quarter, GP2.1bn ($1.5bn) was paid out, down 5% from the previous quarter.
Notably, the value of the average claim paid jumped 27% on the previous quarter to GBP4,600 – the largest quarter to quarter rise on record. The value of both the average theft and accidental damage claim rose by 14%.
The figures come as the average price paid for comprehensive motor insurance at GBP460 currently stands at a four-year low.
“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,” said ABI general insurance manager Laura Hughes.
Asia Insurance Review