Auto repair costs are going up in part because of changes in parts and new, more complex vehicles, an insurance information management firm said.
San Diego-based Mitchell International–a provider of information, workflow and performance management solutions for the automotive insurance claims industry–said its findings on repairs and other trends will be part of the data it presents at an upcoming conference.
Jamison Day, Mitchell senior director of information services, and Thomas McCarthy, executive vice president and founder of Mitchell Medical, are due to appear March 11 at the Society of Insurance Research Product/Claim Summit in San Antonio, Texas, for a talk on leveraging claims data, the company said.
According to Mitchell, in a trend that will likely continue into the future, increases in average repair costs have been seen from the use of aluminum body parts and the dramatic growth of hybrid vehicle sales.
The company said it recently did a study that "reinforces that the current trend of a flattening to slightly declining portion of total losses has been occurring in the industry over the last few years. Changes in vehicle mix, moving toward vehicles with lower underlying total loss rates, have driven the drop."
Mr. Day said in a statement that at the conference, the company would try to "highlight some examples where we can use claims data for generating insights and trends that may also be interesting and helpful for the underwriting side of the house."
Concerning aluminum parts and hybrids, Mr. Day said, "If the overarching market trends continue into the future, we expect the underlying trends in claims to continue–something the underwriting organizations may want to weigh as they think about future pricing."
Mitchell Medical will also present its own set of trend analysis and results at the conference. Mr. McCarthy will address how inflation in the cost of medical care is impacting auto bodily injury claim severity.
The company said Mr. McCarthy will also share information with insurers on how they can combat this phenomenon and effectively control costs using a comprehensive medical management system.
"It is critical for insurers to be aware of the importance of streamlining cost controls and improving performance. If insurers understand just how important a total medical management system is to the injury claims process, they will be better able to serve their customers by efficiently handling the review process," said Mr. McCarthy.
The Society of Insurance Research was founded in 1970 to provide a forum for the free exchange of ideas in all areas of insurance research and now includes marketing and planning.
SIR includes representation from insurance and non-insurance companies, government agencies, institutions of higher education, and trade associations. SIR is online at www.sirnet.org.
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