British motor insurers have settled by 19% less claim files in 2020, but paid claims decreased by only 6%

28 April 2021 — Daniela GHETU
Following the Covid lockdowns during the year, the number of motor insurance claims settled by the British insurers in 2020 fell by 19%, according to the ABI (Association of British Insurers) data. Total claims paid also fell, but at a much lower rate, of 6%.

During 2020 the average personal injury payout rose 13% on the previous year to GBP 12,100. During the same period, the average price paid for private comprehensive motor insurance remained at a four-year low. Throughout the pandemic, motor insurers have been providing a range of extra support and help to their customers.

ABI's data highlight that, in the last quarter of 2020, the number of claims settled fell by 13% on the previous quarter to 468,000. The number of claims usually falls in this quarter with fewer vehicles on the roads over the Christmas break.

Overall, in 2020:

  • The number of claims settled, at 2.1 million, fell by 19%. Total payouts, at GBP 8.3 billion, reduced by 6% on the previous year. These figures reflect the impact of the national lockdowns with reduced road usage; current figures from the British Government show a 14% fall in road traffic in the year to June 2020.
  • The overall average value of a claim paid was GBP 4,000, up from GBP 3,400 in 2019. This 17% rise on 2019 reflected rises in average personal injury and vehicle repair cost claims.
During 2020 the average price paid for private comprehensive motor insurance was GBP 465, remaining at a four-year low.

"As we edge back to some form of normality, cost pressures remain, such as increasing vehicle repair costs, reflecting ever more complex vehicle technology. With the average personal injury claim rising last year, the advent of the whiplash claims portal in May should help control whiplash costs, while ensuring that proportionate compensation is paid to genuinely injured claimants," Laura Hughes, ABI's Manager, General Insurance, said.

The trend seen on the British motor insurance market is the same as in many other European markets, where the lockdowns have reduced the traffic on the roads. Yet, as most vehicles that remained active were the commercial ones, including trucks, the average of the damages resulted following road incidents has increased as compared with the previous periods, of "normal" road traffic.

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