As expected, the number of motor insurance claims notified to insurers in the second quarter of the year significantly fell according to figures from the Association of British Insurers.
The fall largely reflected the lockdown period, when far fewer vehicle journeys were made. Claim payouts during the period while also down, fell at a lower rate.
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.”
The figures show that:
Dan Hutson, head of motor insurance, at comparethemarket said, “The fall in the number of claims is a clear result of the reduced number of cars on the road during the pandemic.
“While premiums have reduced over the past few month as a result, it is essential that insurers continue to pass on any savings that they receive onto their customers, many of which are struggling financially from the impact of the pandemic.
“According to our Household Financial Confidence Tracker, 17% of households are worried about being able to pay their bills in the coming months. Despite the recent fall in premiums, motor insurance is in danger of becoming an unaffordable luxury for many and this could have significant consequences given the importance of cars in everyday life.”