Insurance payouts for car theft at highest level since 2012
Figures from the Association of British Insurers suggest a payout for motor vehicle theft is made every eight minutes on average
The number of payouts made by insurers for car theft has reached its highest quarterly level since 2012, with a payout made every eight minutes on average, according to figures from the Association of British Insurers (ABI). The cost of said claims have risen 20 per cent year-on-year.
The industry body’s latest quarterly report shows there were 16,000 claims for theft of or from a vehicle in the first three months of 2019 – up from 14,000 in the same period last year.
In addition, the cost of payouts for vehicle theft was £108 million – up 22 per cent year-on-year. Some £1.2 million is paid out to policyholders every day, with the overall cost of claims having doubled over the last four years.
The rise in payouts is likely driven by a continuing increase in car crime, which has been reflected in Home Office data. The ABI believes a contributing factor in this is keyless theft, with thieves able to steal a car via a relay attack in as little as 20 seconds, according to the Master Locksmiths Association.
The cost of vehicle repairs, meanwhile, was £1.2 billion in the first three months of 2019 – the highest quarterly figure since the ABI started collecting this data in 2013. This is due to newer vehicles having a more sophisticated design. For example, the cost of a replacement headlamp for one popular model has risen by 400 per cent from £163 for a 2012-17 example to £840 for the latest generation.
In spite of these cost pressures, though, the average price paid for car insurance is now £466 – its lowest level in two years. The ABI suggests this could be a result of some insurers passing on the expected cost benefits of the Civil Liability Act reforms that are anticipated to be introduced soon. Another factor could be a rise in new car sales in March, with these vehicles normally being bought by older, more experienced drivers.
Laurenz Gerger, motor insurance policy adviser at the ABI, said the continued growth in car crime “must be reversed”, calling on manufacturers to “keep pace with the ingenuity of car criminals”.
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