Specialist motorcycle insurance broker MCE is trialling a new approach to third-party interventions, with an ambition to save around £8m annually by reducing its exposure to credit hire costs.
MCE chief executive Julian Edwards explains: “Credit hire is an effective way to provide non-fault drivers with replacement vehicles while their own are in for repairs. That’s a legitimate requirement. But some of the rates that we see being charged are unreasonable, the replacements being used are over-specified and the hire durations are too long. It’s an industry-wide issue that needs to be addressed.”
But the insurer now has access to data that allows it to find the best rate available for a hire vehicle in a given postcode. And a new communications process with non-fault third parties means supply of an appropriate vehicle can be offered without the need for the third party to enter into a credit agreement — and at a better day rate — which MCE agrees to settle directly.
“It’s win-win,” adds Edwards. “As a business, we are saving money by taking this stance. But for the insured, and for an injured third party, we are intervening immediately and finding ways to keep claim costs down for them and actually looking to reduce the time frames for vehicle repair or replacement. So we can achieve a faster settlement. That’s what insured motorists want from the insurance industry.”