Who are the top commercial car insurance players working in the UK market today? It was a question asked and answered by the 2023 IBUK Brokers on Commercial Motors report. The comprehensive report surveyed 100s of domestic brokers to glean the most important factors to consider when working with an insurer.
In addition, the research explored the wider external factors influencing the commercial car insurance market and how economic concerns, including motor claims inflation, are impacting the space.
Commenting on the trends he’s seeing, Gerry Ross, head of commercial motor at award-winner Allianz Insurance, highlighted the impact of Brexit and the war in Ukraine – and how these considerations have exacerbated labour shortages, supply chain issues and energy inflation.
“Some body shops have been struggling to find qualified mechanics; many have experienced delays in procuring spare parts; all have seen their electricity bills flare up,” he said. “As a result, claims costs have gone up massively. Insurers have absorbed what they could and worked hard with suppliers to control what was within their control.
“However, some external factors are outside of our control and that’s why the whole commercial motor market is undergoing some adjustment.”
But it’s not all “doom and gloom”, Ross said, as there are encouraging new developments in commercial car insurance, including sustainable mobility. As an example, Allianz fleet policies cover electric vehicles (EVs); their engineer surveyors inspect public EV charges; and their approved repairers use green parts.
Matthew Warden, area director at the specialist division of fellow award-winner Towergate Insurance, also highlighted the impact of the ongoing economic disruption on the commercial motor insurance market.
Taking a simple car repair, for example, he said, he identified what would happen in the case that a truck drove into the door of a third-party car. The truck insurer will take the car and get that door repaired but this routine repair is now hit by several factors, including that:
• The time to repair has trebled due to the limited availability and time to supply that car door if a new one is needed.
• The limited supply plus the increased production costs means the price of that car door has increased by a high percentage.
• Because the time now being taken to get that repair completed is trebled, if the insurer is having to fund a hired car for the third party to drive around in that car, the hire bill is treble what they would have previously expected.
“There are a number of complex elements to underwriting, pricing and indeed claims,” Warden said, “but the above simple car door repair encapsulates why insurers who would have budgeted for repairs based on reasonable inflation are very concerned about the impact claims inflation is having on UK general motor insurance.”
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