In the final weeks of 2020, we discussed our claims projections for 2021. One projection was that for the first part of 2021 the level of road traffic claims made would be lower than normal, owing to the effects of the national lockdowns in place during 2020. We are still within Q1 of 2021 but the now published claims figures for 2020 indicate this prediction is likely to be realised. The figures produced by the Association of British Insurers (ABI) show that the number of claims settled by motor insurers fell by 19% in 2020, with national lockdowns prompting a fall in the number of people on the road. With liberty restrictions and the 'stay at home' direction still in place at the end of 2020 and start of 2021, there is no reason to think this trend will change.

Interestingly, however, whilst the number of settlements fell, the average value of claims settled did rise by 17%. As we mentioned before, past experience tells us that insurance fraud tends to rise in difficult economic times. That legitimate claims could be subject to exaggeration is now more likely and may already be filtering into the available statistics. Against that background, early triage by insurers for fraud indicators is vital and so too full interrogation of vouching produced.

As we continue to look ahead, there are significant changes to the driving laws of Scotland and the UK coming down the track, including the long-awaited Whiplash Reforms in England. We will be keeping a close eye on what impact these changes have on claim trends both north and south of the border.


Gemma Nicholson

Senior Associate