Addressing the value and coverage gap for all injured customers
Can motor insurers shift focus to address the needs of all customers injured in road traffic accidents regardless of fault?
If a customer is injured in a road traffic accident (RTA) and there is no negligent party to pursue there is limited support available to help them cope with the impact of the accident. Their insurer while dealing with damage to their insured’s vehicle and the inevitably focus on the non-fault party to mitigate and control costs, provides no support if their insured is injured. This leaves their own customer, while having caused the accident, still needing help. This doesn’t feel right, and more of those in the sector agree that it’s time to evolve.
The gap in motor personal accident
Many will point to the fact that there already exists a product to bridge this gap in the shape of motor personal accident (motor PA) cover. Primarily, current motor PA products provide compensation for death and significant injuries sustained because of a RTA. As a result of this ‘catastrophic’ outcome focus, the cover faces the challenge of low product utilisation and with that, the possibility of criticism about whether it delivers fair value. So, is motor PA fit for purpose for all RTA victims?
Accident data seems to point to a coverage gap for those in RTAs that do not result in a significant injury or death. According to government figures, there were 333,296 road traffic accidents in Great Britain in 2022 [1]. Department for Transport provisional data for last year shows a total of 1,696 people were killed and 28,967 seriously injured [2]. For those killed or seriously injured, motor personal accident cover could provide some cover. For those who sustained a less serious injury, the majority, a motor PA policy would have little or no help.
Is this an area that the government’s recently launched motor insurance taskforce could focus on? It will be looking at the rise in motor insurance premiums, issues of accessibility and the delivery of fairer outcomes for policyholders so perhaps the scope and reach of current motor PA products is worth a look.
Evolution needed
Product evolution in this space has been limited to increased coverage limits and, in some cases, physio and psychological support. But the bottom line is the product remains focused on covering those with serious injury or death.
Motor insurers talk about a commitment to customer service and supporting their policyholders when they need it most. However, their own customers may not experience this level of support when sustain an injury in an accident. This lack of support raises questions over whether there is an appetite to change the status quo.
We are seeing a growing recognition that this gap in support needs to be addressed to ensure all customers are treated equitably and given the help they need to recover both mentally, financially, and physically after an accident. A black or white approach to treating fault and non-fault creates a disparity that policyholders find hard to comprehend. What effect does this have on their view of the insurer and future renewal?
Insurers have demonstrated there is an appetite for further reform in motor. So why not put the focus on care and equality of support which could demonstrate a genuine understanding of the needs of all policyholders regardless of fault and be a much-needed counter to the criticism around insurance premium costs?
Recovery First
The gap in the current motor PA market has been part of the motivation behind our Recovery First solution. Recovery First offers assistance currently provided to non-fault motor accident customers, but none of which are provided to customers injured in an RTA who are unable to claim these costs from a negligent third party.
Alongside a cash benefit if the customer is unable to work due to an injury sustained in a motor accident, there’s cover for rehabilitation costs to expedite the customers physical recovery from their injuries, and driver confidence lessons. Also, for serious injury there is cover for home adaptions and in the event of death, funeral costs can be covered.
To find out more about Recovery First and how it could support your clients as part of their motoring insurance needs visit our website
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