From the moment a motor claim arrives in front of an assessor, it triggers a series of questions. Should I pay this claim? How much do I pay? Is that within the policy limitations? According to the Financial Ombudsman Service (FOS), most of the vehicle write-off and valuation complaints it receives involve disagreements about the market value of the vehicle[i]. Therefore, it’s easy to see how getting the right answers to these questions can make all the difference in the quick and smooth processing of a claim, resulting in positive outcomes for claimant and insurance professional alike.
One look at the case studies on the FOS website reveals that many of the vehicle market value complaints stem from the condition of the vehicle in question, or its mileage at the time of claim[ii]. With economic pressures forcing the age and average mileage to increase for the UK car parc[iii] and drivers putting maintenance on hold[iv], the job of the claims professional could become so much simpler with easily accessible, real-time valuations data right when they need it most.
Indeed, the more information an insurance professional can capture about the vehicle at the point of claim, from valuation and MOT history to its mileage, the better the customer outcomes are likely to be. Bring in the presence and performance of Advanced Driver Assistance Systems (ADAS) at the vehicle identification number (VIN) level, and the picture of that vehicle becomes even clearer, providing many of the answers needed to correctly route the claim.
With the FCA issuing a warning over vehicles being undervalued by insurance providers[v], this information cannot come too soon. As more granular data becomes available, there needs to be a real shift in the market when it comes down to the use of vehicle centric data to understand more about the ‘metal’ at the point of claim.
That shift has already begun. The motor insurance market is starting to test a new vehicle-centric data solution at the point of quote called LexisNexis® Vehicle Insights, positioned to deliver key attributes around vehicle specification, usage and valuation features. It will offer a layer of granularity beyond the basic make and model information already available to the insurance market, since no two cars are 100% alike.
Each vehicle has a unique history that will affect its material value, and it is becoming increasingly important for the insurance market to be aware of those differences. This is imperative to ensure that the right decisions can be made at speed, helping to settle the claim and most importantly, to the claimant’s satisfaction.
It’s when data on the history or back story of the vehicle is combined with LexisNexis® Vehicle Build, a VIN-level ADAS fitment solution, as well as data on the driver – such as their policy and claims history – that the risk comes into sharp focus. This is very much our vision at LexisNexis Risk Solutions – in effect, we want to give the motor insurance market a ‘one stop shop’ of essential data insights for the vehicle and the driver, all from one platform, to support every part of the customer journey.
While the cost-of-living crisis continues to bite, valuations disputes may persist. Calculating fair valuations and justifying those decisions is a crucial aspect of building trust and transparency, and it can pay dividends at renewal. It all comes down to having quick access to accurate, real-time data.
We hope to play a part in keeping the Ombudsman’s in-tray empty, allowing claims managers to make quicker, more accurate valuations decisions that will help keep their customer happy, supporting customer satisfaction and loyalty in an increasingly price-aware market.
[i] https://www.financial-ombudsman.org.uk/businesses/complaints-deal/insurance/motor-insurance/vehicle-valuations-write-offs
[ii] https://www.financial-ombudsman.org.uk/businesses/complaints-deal/insurance/motor-insurance/vehicle-valuations-write-offs
[iii] https://www.thisismoney.co.uk/money/cars/article-10804657/Car-mileage-quarter-cars-Britains-roads-100k-miles-more.html
[iv] https://www.halfordscompany.com/news-and-media/press-releases/motoring-news/four-in-ten-motorists-not-able-or-concerned-about-affording-their-next-mot-with-45-saying-they-will-break-the-law-and-drive-their-car-without-one-and-17-already-have/ https://www.themotorombudsman.org/press-releases/tmo-urges-motorhttps://www.fca.org.uk/news/press-releases/insurance-providers-warned-not-undervalue-cars-or-other-insured-items-when-settling-claimsists-to-keep-vehicle-servicing-front-of-mind-in-the-face-of-cost-of-living-hike
Content provided by Tom Lawrie-Fussey, automotive director, LexisNexis Risk Solutions, Insurance, UK and Ireland
