Car Insurers Have Saved 97 Million Pounds in the East Midlands During Covid-19 Lockdown

£ 96,789,593

…is the estimated amount of savings on payouts realized by the UK car insurance companies in the East Midlands during Covid-19 lockdown, as drivers stayed home between 23 March and 31 May.

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Claims drop during lockdown

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Cost of claims in a “normal” 77-days period

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Car insurers’ savings during lockdown

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East Midlands big numbers

72%
drop in car claims
 

…across the East Midlands

14.4
million pounds saved


…by car insurers only in the Notthingham metropolitan area.

£47.8
average decrease

…of annual insurance car premiums

72% drop in car-related claims

With the UK locked down from the 23rd of March, most English citizens were forced to stay at home. As a consequence, daily commutes came to a halt, meaning fewer people on the roads, and a lower probability of accidents occurring. With a 72% drop in car-related claims, the East Midlands are the fifth region in the UK where those claims have decreased the most, behind the Greater London area (82%), the West Midlands (76%), South East England (74%) and the East of England (74%).

Overall, insurance companies in the East Midlands could have actually saved up to £96.8 millions thanks to the change in driving habits caused by lockdown measures.

  • The East Midlands metropolitan area accounting for the highest savings is Nottingham, with a £14.4 million reduction in payouts by the insurers. The city of Leicester ranks number 2, with £3.9 million saved by the insurers.
  • Usually, motor insurers put aside ⅔ of premiums to cover road accidents. However, the reduction in the number of accidents has cut that  proportion significantly. One big car insurance player expects it will save as much as half the funds it expected to have to pay out for personal injury claims in 2020.

Will customers receive their money back?

With the savings made while the East Midlands were locked down, the big insurance companies decided to reduce the premiums for their customers. That is why it has been observed in the region an average £47.8 annual price reduction on car premiums per customer. Indeed, the average annual premium was £595 as for March 2020, and has gone down to £547.2 at the beginning of June – which represents an 8% decrease in prices for the East Midlands drivers.

Admiral was the first car insurance company in the UK to announce a £180 million spending including a fixed £25 refund to each of its car and van insurance customers – which could represent a £13 millions refunds sum for the clients from the East Midlands. Others are planning on refunding only customers that were affected by the pandemic, such as the unemployed or people placed on a government furlough scheme by their employer. 

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Antoine Fruchard, insurance expert and CEO at hello-safe.co.uk

Because the car-related claims have dramatically plummeted in the East Midlands, we could observe that the car insurance industry saved there a lot of money during the lockdown. For example, in the only city of Chesterfield, those savings accounts for about more than £2 million during the whole period, which is a lot. Now that the lockdown is over, the number of cars on the road could soon be back at pre-Covid levels. It is likely that customers will question why they continued to pay such high insurance premiums while they weren’t able to drive. While some insurance companies have already made refunds, it has been observed a £47.8 average decrease in car premiums in the East Midlands between March and June, which proves that the competition is hard between the major motor insurers”.

Our methodology

We based our study on public information provided by reliable data-providers – such as the ABI, Which, Willis Tower Watson and Money Wise – and 18 European insurance partners who provided us anonymously with claims for the period from the 23rd of March to the 31st May. 545,560 policy holders from all the UK regions have been taken into account. For further information on our editorial guidelines please click here.

About hello-safe.co.uk

Hello-safe.co.uk is a comparison platform which is shaking up the insurance market in the UK, Canada, Brazil and much more countries – giving you access to the best UK insurance deals in less than 30 seconds. Hello-safe.co.uk is supported and financed by Blue, an Insuretech Venture Capital firm. Blue already owns two leaders in the French insurance comparison market, Réassurez-moi and Coover. These platforms help more than 10 million people with their insurance every year. We have developed a unique comparison technology that gives access to cover details and quotes without customers having to give their phone number or email address. This engine is the result of four years of hard work.

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