UK-based community car clubs are at risk of dissolution due to providers refusing to insure them.
“Getting insurance [for small car clubs] has become harder and harder since COVID as one by one all the big insurers have pulled out, apparently fearful of insuring something a little out of the ordinary,” a report by The Observer cited CoMoUK’s Richard Dilks as noting.
“We don’t understand why it has become so, as the risks haven’t changed. Now the last firm providing cover has pulled out with devastating consequences.”
Charity CoMoUK champions shared transport solutions such as car clubs, among which is a co-operative in north Cambridge whose policy won’t be renewed by its insurer. Facing closure next month, the club consists of around 25 residents and four vehicles.
“Our broker, an expert in the field, has told us they have not managed to place a single car-share risk this year,” Chris Wilson, part of the co-operative, was quoted by the report as saying. “We expect that we will have to sell, mothball, or loan the cars to members when our insurance runs out. It’s so frustrating – to be let down by what is in effect a market failure in the insurance sector.”
A representative from the Association of British Insurers (ABI) pointed to the industry’s openness to diverse transportation and ownership models but highlighted where the issue lies when it comes to car share clubs.
“While insurers are supportive of different modes of transport and vehicle ownership, car clubs present a unique challenge wherein driver risk is difficult to measure,” an ABI spokesperson told The Observer. “However, we understand the importance of car clubs to certain communities, and we are currently discussing the situation with our members and the British Insurance Brokers’ Association.”
In February, the ABI released an action plan aimed at reducing insurance costs for motorists. The strategy spans a host of measures – none of which relate to community car clubs, whose options now might include being hosted by a big (and insured) platform like Hiyacar.
It was reported that as much as 40 car share clubs could be shuttered as a result of the latest insurance market pullout.
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