UK motor insurance premiums have continued to rise in 2011, with some drivers facing price increases of up to 50 percent. At the same time, the fall in the number of deaths and serious injuries on British roads has resulted in a 10 percent year-on-year reduction in the frequency of large claims (measured against premium income). This is according to the findings of the annual UK Motor Market Review by Willis Re, a reinsurance advisor and part of Willis Group Holdings, the global insurance broker.
Willis Re’s fourth annual review, which surveys over 50 percent of the UK motor insurance market, examines patterns in large motor claims.
Key trends highlighted by the survey include:
- The tendency for large bodily injury claim values to escalate faster than inflation has been recognized for some time. The report shows, however, that the rate of escalation has remained relatively constant over time – a good point for motor insurers to be able to demonstrate in motor treaty negotiations.
- Insurers are generally becoming more accurate in their reserving of claims. As earlier reserving becomes the norm, we are seeing general claims valuation reaching maturity much more quickly than in the past. The study shows that claims reserves are six percent closer to maturity by the end of the second year than they were in 2010.
- Increases in original premiums and falling accident numbers have meant that the number of large claims (up to a value of £5million), measured against premium, have reduced by 10 percent.
- Male policyholders are twice as likely as female policyholders to have a large claim.
Source: Willis Re
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