The volume of the new consumer car financing business increased

According to the Finance and Leasing Association, the consumer finance market saw new business growth of 7 percent in September 2020 compared to the same month last year.

However, the volume of new business in the first nine months of 2020 was 22% lower than the same period in 2019.

In the consumer new car financing market, the volume of new business increased by five percent in September 2020 compared to September 2019, while new business in the nine months to September 2020 decreased 27 percent.

However, FLA member-funded private new car sales in the twelve months ended September 2020 stood at 94.5% – the second highest annual penetration rate in history.

The new business volume for the consumer car market increased 9 percent in September 2020 compared to the same month a year earlier, while it was down 19 percent in the year to September 2020 compared to the same period a year earlier.

Geraldine Kilkeley, chief researcher and chief economist of the FLA, said: “The latest FLA data show that the consumer auto finance market has played a key role in Britain’s economic recovery since the deadlock’s first restrictions were eased in June.

“As the UK enters a new phase of national impasse, it is important for the government and the Bank of England to provide direct access to finance to all lenders, including non-bank lenders.

“This will allow the auto industry to meet the demand for patience and sustainable new credit.”

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Car insurance prices fell for the third consecutive quarter

Car insurance prices in the UK fell for the third straight quarter. Drivers now pay an average of £ 50 less than early 2020.

This is from Confused.com’s latest auto insurance price index, which shows that the average cost of comprehensive auto insurance is now £ 765 after dropping £ 5 in the last quarter.

Figures based on pricing data comprising nearly six million customer offers per quarter also show that prices have fallen 2% over the past year.

And they could fall even further after the Financial Conduct Authority (FCA) announced last month that they would prohibit insurance companies from increasing premiums for policyholders who are in what is known as “price increases.”

Louise O’Shea, CEO of Confused.com, said, “These have been turbulent months for the auto insurance world and will likely continue for some time as insurance companies try to adapt to the constant and dramatic changes in driver behavior. Not to mention how they handle it. much-needed changes to the FCA that were announced last month.

“FCA has proposals to make the switch easier by simplifying the automatic renewal cancellation process so we can see how people are using this as they become more price conscious.”

The index, co-produced by Willis Towers Watson (WTW), shows that drivers crossing the Scottish border benefited from the biggest quarterly price drops and their premiums fell 5% on average to £ 554.

Inland London was the only region in the UK to break the downward trend in prices in the last quarter as the cost of comprehensive auto insurance rose 3%.

Drivers aged 17 and over benefit from the largest price reductions compared to other age groups. They saw a 7% cut in quarterly prices and reduced their annual premium to £ 1911.

Meanwhile, 33 year old policyholders experienced the largest price increase of 2%, increasing their annual premium to £ 705.

“One of the biggest challenges for insurers and intermediaries is managing the transition to new global prices in the face of current market pressure on competition and therefore deciding how and when to make price changes,” Graham said. Wright, UK Head of P&C Personal Line Pricing at WTW.

“This definitely remains one of the most challenging moments in insurance pricing.”

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Auto insurance claims were cut in half during the blockade

Auto insurance claims were cut in half during the blockade

Britain filed nearly half of its usual auto insurance claims between April and June this year, as coronavirus blocking measures reduce commuting to work and storing cars in garages.

According to the British Insurers Association (ABI), drivers made 324,000 new claims on their auto insurance in the second quarter of this year. This is 48% less than the 678,000 claims registered in the past three months.

If the British wanted, they got a bigger number. Average claims value rose 27% to £ 4,600, the biggest growth on record for the quarter.

Part of the increase in the average claim value may be due to continued vehicle theft during closure. While road traffic at lock depth has decreased by 73% to levels not seen since 1955, vehicle crime remains unchanged.

Motorcycle insurance specialist Carol Nash found that as of March police had recorded 32,250 crimes, including vehicle theft and vehicle damage. This has only decreased by 10% since February, 14% below the very high levels seen in March 2019 and 8% below the March 2018 figures, despite the fact that traffic has halved.

Mark Cooper, Product Manager at Carole Nash, said: “We have seen a consistently high number of total theft claims, not only for vehicles during the blockade (cars, trailers and motorbikes), but also vehicle parts. “

While the UK gave up public transport and sought distraction and exercise during the blockade, claims for personal injury, especially for cyclists and pedestrians, rose to 20% instead of the usual 10%. find More Than insurance companies.

Auto theft and personal injury are some of the most expensive damage insurance. ABI has previously determined that the increase in repair costs following the closure of several garages also contributed to higher claims.

This means that while fewer claims were paid this spring compared to the first quarter of this year, payments fell less than claims. A total of £ 2.1 billion in auto insurance was paid out between April and June, according to ABI, a 5% decrease from January to March.

This lower claim fee reduces auto insurance costs. Full auto insurance is now averaging £ 460, a four-year low and a 3% decline year-to-date.

Laura Hughes, General Insurance Manager of ABI, said: “Lockdowns of course result in significantly fewer vehicles on the road, which is reflected in a reduction in the number of car claims. As the average car insurance cost is currently the lowest in four years, insurance companies are providing savings. them to their customers. “”

However, he said insurance costs remained high, limiting price cuts.

“There are still cost pressures, such as the increase in vehicle repair costs, due to the sophistication of cars and the rampant theft of vehicles,” he said.

The cost of personal injury has also continued to rise, and the government should implement surprise reforms in April as planned, he said. A change to cut the auto insurance industry’s annual spending on household claims, many of which are bogus, by £ 2 billion was delayed a year ago because of the pandemic.

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