Frequency of auto injury claims ticking up

by R.J. Lehmann on January 5, 2012 · View Comments

After years of decline, the frequency of auto injury claims appears to be on the rise again, a troubling development given the recent steady increase in average costs per claim, according to new data from the Insurance Research Council.

According to IRC’s 2011 Trends in Auto Injury Claims report, the council found that in states with at-fault bodily injury claims, 2010 marked the first year since 1994 that claim frequency did not decline. Meanwhile in no-fault states, where drivers purchase personal injury protection, an increased claim frequency has magnified the effect of rising claim severity, so that per-vehicle PIP claim costs rose 18% from 2008 to 2010.

Driving that spike has been rising PIP claim costs in three states in particular: New York, Florida and Michigan. Florida’s average PIP claim costs jumped 62% from 2008 to 2010, while in Michigan, they’ve risen more than 120% over the past decade. Regular OOTS readers will be familiar with the problems seen in the PIP insurance markets in both Florida and Michigan, particularly relating to rampant fraud.

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