You are here: Home - Insurance - News -

Car insurance claims halve during lockdown

Written by:
The number of car insurance claims in the second quarter of 2020 fell significantly as fewer car journeys were made during lockdown, data from the Association of British Insurers (ABI) reveals.

There were 324,000 new claims in the second quarter of the year, down 48% on the 678,000 recorded in the previous three months.

While claim payouts also fell (includes existing settled claims from previous quarters), the ABI noted this was at a much slower rate than the number of new claims.

In total, £2.1bn was paid out, 5% down on the previous quarter. However, the value of the average claim jumped 27% to £4,600. The ABI said this was the largest quarter-on-quarter rise on record.

Overall, the average theft and accidental damage claim rose 14% while the average value of personal injury claims leapt 34% to £19,500.

The figures come as the average price paid for comprehensive motor insurance stands at £460 – 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.”

Dan Hutson, head of motor insurance, at 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.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week