Car insurance provider By Miles is calling for insurers to provide fair refunds to customers
Throughout 2020 and continuing into 2021 there has been significant less mileage by car owners with the lockdowns and also the tiered systems which has discouraged driving. By Miles is calling for its fellow insurers to provide fair insurance premium refunds to customers which reflects the reduction in their driving activity.
By Miles recently stated that car insurance claims nearly halved, a reduction of 48%, in the first pandemic lockdown between April and June 2020 – data from the Association of British Insurers. They also went on to speculate that with the latest tiered lockdown measures put in place over the last few months, as well as the full lockdown this year, insurers stand to profit by as much as £4.4 billion.
So, millions of UK drivers have already overpaid for car insurance policies they are not using, with the young and the elderly being hit particularly hard.
During the first lockdown, car insurer Admiral set a precedent with its automatic refunds of £25 to each customer, based on reducing driving levels. This has only happened once and not for the subsequent lockdowns in 2020.
By Miles, with data from in-house research, has projected that the actual refund for the three months of strict lockdown in late 2020 should have been £65, a figure which does not reflect the later regional lockdowns or the reduction in driving over the year. They are urging all insurers to treat customers fairly with refunds. With people driving less means fewer accidents and that means that insurers are gaining on profits from the savings. It seems only fair that these savings should be passed on to support motorists at a difficult financial time.
Oakwood Insurance Brokers have contact their insurers for their comments, we are waiting for a reply.