Insurers accused of overcharging drivers as claims halve during lockdown

Car insurers have been accused of short-changing their customers after a sharp fall in the number of claims in 2020.

The Association of British Insurers (ABI) revealed a 48 per cent drop in claims during the second quarter of the year - the peak of lockdown - with 324,000 claims made between April and June, down from 678,000 in the first quarter.

It also said that premiums had fallen to a four-year low of £460 but specialist insurance providers have accused traditional rivals of still pocketing up to £1 billion in savings.

The ABI said that the fall in claims reflected the far quieter roads during lockdown - the AA estimates that traffic fell by between 60 and 80 per cent.

However, the overall value of claims did not decrease nearly as quickly, dropping five per cent to £2.1bn, and the value of the average claim actually rose 27 per cent to £4,600. That covers claims made during the second quarter of the year as well as payouts linked to existing claims from previous quarters. The average value of a personal injury claim jumped even further - by 34 per cent to £19,500.

Laura Hughes, ABI’s manager for general insurance, commented: “Lockdown naturally led to far fewer vehicles on the roads, which is reflected in the fall in the number of motor claims.