As time has passed, we are amassing a better understanding of the impacts of COVID-19. Since the COVID crisis began last March, bodily injury claims have increased inversely to total paid and closed counts. Six months of data shows that both early settlements and claims settled are up year-over-year 12% and 8.8%, respectively. As collision and property damage paid and closed dropped, claims severity has stabilized through September in both coverages. These claims trends, and the additional details outlined below help to identify areas of change that merit further scrutiny by claims departments.

Bodily Injury Severity

Bodily Injury (BI) severity with 90-day early settlements climbed 0.6% in September, a small increase from the trend we saw in June through August.  Overall, this is a 3.5-point increase from March 2020.  The number of claims paid and closed dropped to their lowest point in September 2020.

When looking at our 180-day settlement view, total U.S. bodily injury severity increased in June 2020 to 8.8% from 8.0% in May and 6.2% in March 2020.  The last time the industry saw 8% growth in severity for longer-term settlements was in July of 2017.  Regarding the number of claims paid and closed, they are down 7.7% in June, dropping further from the decline of 5.7% in May 2020.

Collision severity

The rate of change in November for collision severity was 4.1%, which was relatively flat from October. This reflects a longer trend last year, where severity increase has remained stable between 4.2% and 4.3%.  Claims paid and closed within 30 days was 17.2% lower than the same month the prior year, down further from the decline of 15.8% the month prior. This is attributable to fewer claims since March 2020 and is the lowest percentage change we’ve seen in the data.  The percent of collision claims closing within one month, while higher than average earlier in the pandemic, has returned to pre-pandemic levels.

Property damage severity

November severity remained steady from October at 5.1%.  As with the collision data, we are seeing recent stability after a 1.5-point drop in March.  Claim counts paid and closed was 22.8% lower than the same month the prior year.  This decline was 2 points more than the decline in October 2020.   

Uninsured motorist

In November, there was an increase of 16% in the rate of uninsured motorist claims relative to total claims compared to the 12 months before the pandemic began.

In 2020, we learned that our industry could turn on a dime when necessary. By quickly accessing and leveraging data and analytics, insurance carriers can maximize their virtual work environments and continue to deliver and improve the customer experience. Reach out to your LexisNexis Risk Solutions representative to learn how.

Note:  All percentages are based on a 12-month rolling year over year % change.