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Insurance To Be Hit By Body Shop Shortages

By raccars Published

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Automotive research firm, Trend Tracker, believes it has identified a potential problem with a shortage of car body shops. The trend could see car owners facing delays on repairs to crash damage, which could result in higher insurance premiums.

There are a third fewer body shops open in Britain now than there were ten years ago, and Trend Tracker has predicted their number to shrink by another 10% over the next five years. By 2020, there are forecast to be only 3,020 body shops in the UK. Bodywork repairs are likely to back up, car owners will face delays and insurers will probably be hit with higher costs.

The decline in body shop numbers is the result of decreasing demand. Car body work repairs as a whole are down by 24% since 2004. Overall car mileage is lower and the rate of accidents has gone down in the past decade. With ABS a standard feature on new cars in the EU since 2007, and serious traffic congestion reducing the number of high speed accidents, the need for bodywork repairs has fallen accordingly. Furthermore, drivers tend to try and avoid making claims for smaller collisions, as these can cost less to repair privately than paying an excess and risk the loss of a no claims discount - particularly as the average excess charge has risen, as car owners seek cheaper premiums in return for higher excess.

Specialist services, such as body shops, can't afford to remain open for irregular work, so on site servicing is seen as a more favourable option. Garages contract teams for smart repairs second hand.

Trend Tracker's 'The Future of the UK Car Body Repair Market 2015-2020' report suggests that the problems will begin in 2020, which is when the number of drivers on the road is forecast to start rising as motoring gets cheaper. With plenty of body shops open ten years ago, insurers could afford to shop around, but with quality outfits getting rarer, insurers are facing higher prices.

At the same time, repair costs are set to increase with the arrival of new technology and more sophisticated materials. Insurance companies are going to have to find ways to cope with the extra expense but, in the ultra competitive UK market, moves to increase premiums have been unpopular with customers.

Trend Tracker has been producing a UK Car Body Repair Market report biennially since 1993.

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