Calls for car insurance refunds as firms are ‘enjoying increased savings’ in lockdown
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Experts at insurance specialists By Miles have warned the latest lockdown will reduce vehicle use and therefore cut the number of accidents and claims. They are appealing for firms to “take measures” to ensure drivers are getting a “fair deal” from their providers.
According to the Association of British Insurers, claims nearly halved in the first lockdown between April and June.
Total claims were down 48 percent during the first wave with experts warning insurers will make even more under the latest measures.
Experts at Safe Insurance has already predicted firms may have saved up to £4.4billion worth of savings during the course of the pandemic.
James Blackham, CEO of By Miles has claimed all savings should be passed onto the public to ensure drivers were not overpaying for cover.
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He warned insurers were enjoying increased profits and claimed they should instead be supporting motorists at a “financially difficult time”.
He said: “We project that the actual refund for the three months of strict lockdown in 2020 should have been £65.
“This isn’t even taking the later regional lockdowns into account, or the reduction in driving for much longer over the course of the year due to the rise in home working and reduced commuting.
“Our own research suggests the UK has seen a fall of 550 million miles per week in driving levels, since the first lockdown in 2020.
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“We’re urging all insurers to be proactive and treat customers fairly with refunds.
“We know people driving less means fewer accidents and we know that insurers are enjoying increased profits from the savings.
“Those savings should absolutely be passed on to the public to prevent drivers from overpaying for insurance, and to support motorists at a financially difficult time.”
Since new lockdown measures came into force on 5 January, daily mileage has already dropped considerably.
Data from By Miles shows daily mileage was down 52 percent compared with the first working week of January.
During the first lockdown, Only Admiral offered all of their customers a £25 refund due to a reduced number of journeys.
LV also offered some financial reimbursement to those who were most affected financially.
Mr Earnshaw said car insurance refunds “shouldn’t be a lottery” and added it did not make sense support was only offered once and not for later lockdowns.
He said: “It doesn’t make sense that a rebate was offered once, but not for the subsequent lockdowns in late 2020 or considered for the current lockdown.
“It shouldn’t be a lottery. We believe it’s only fair that insurers consider refunding drivers who are following the rules of the current lockdown to help stop the spread of the Coronavirus.”
By Miles said the pandemic had highlighted the benefit of flexible car insurance policies.
They added their members’ total insurance costs fell by 25 percent in 2020 due to the reduced mileage covered.
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