2016 Star Ratings Motor Fleet Insurance Discussion paper

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2016 Star Ratings

Motor Fleet Insurance

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About this document

This document outlines the key developments and trends that will inform the criteria we use for the 2016 Star Ratings for Motor Fleet Insurance – and, based on these, sets out the areas where we would like to consult the industry as part of ensuring that our ratings process remains robust and transparent.

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Key developments and trends

The market

We have reviewed developments in the motor fleet insurance market, considering legislation and

regulation, provider changes, and motor fleet insurance products and have concluded that there has been no significant changes.

Legislation and regulation

There have been no legislative changes or FCA review into the motor fleet insurance market that would change our thinking towards the Star Rating criteria that is being considered for 2016.

Providers

The motor fleet market has seen a small increase in provider numbers when comparing 2010 to 2015.

Star Ratings Product Area 2010 no. of providers

2015 no. of

providers % Change

Motor Fleet Insurance 26 29 12%

Products/propositions

In addition to the increase in providers we have also seen increases in the number of products available, with a small number offering differing levels of cover aimed at different type of fleet customers.

Star Ratings Product Area 2010 no. of products

2015 no. of

products % Change

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Key implications for the 2016 Ratings process

Product area weightings

The criteria have been split into the following areas in order to show the weightings for each within the ratings:

Rating area

Star Rating Features 2014 No. of features 2014 % share of features 2015 No. of features 2015 % share of features 2016 No. of features 2016 % share of features Policy Cover 30 47% 29 47% 29 47%

Accident Management Services 18 28% 18 29% 18 29%

Policy Excesses/Terms 10 15% 10 16% 10 16%

Policy Add-ons 5 8% 5 6% 5 6%

Helpline Services 1 2% 1 2% 1 2%

Total 64 100% 62 100% 62 100%

At each Star Rating review we consider market changes and the relevance of these factors. As you can see the statistics above demonstrate that we will only change the criteria should the need arise following market changes or amendments, or potential amendments in legislation.

What does good look like?

For 2016 we see no need to change the core criteria for 5 or 4 Star rated products from those which are currently being applied.

Motor Fleet Insurance Core criteria set for the following

Policy Cover  Property Liability - Cars

 Property Liability - GCV

 Windscreen Limit

 Theft of Keys Limit (£)

 Personal Effects

 European Cover Limit Accident Management Services  Vehicle Rescue Cover

 Courtesy Private Car

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Areas for discussion

These are the areas where Defaqto would like to discuss their proposals, and receive any feedback that you might have.

No proposed changes

There has not been any noticeable changes within the motor fleet market and therefore we believe that no further changes are required for 2016

No other changes to product features studied

We carried out a review of our DNA scores and haven't seen any dramatic market changes that would require us to make any changes for the 2016 Ratings

There are no obvious elements of policy cover that might emerge over the next 16 months

We cannot see any reason to remove any of the existing elements of cover from our Ratings because of market changes likely to happen in the next 16 months

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Appendix: Proposed 2016 criteria

Based on the above analysis, we propose including the following criteria in our assessment process for the 2016 Ratings (core criteria are in bold text).

Proposed criteria

 Property Liability – Cars  EU Cover Limit  Property Liability – GCV  Customs Duty

 Indemnity to Owners  Uninsured Loss Recovery

 Indemnity to Principals  Uninsured Loss Recovery Cover

 Contingent Liability  Breakdown (availability)

 Cross/Joint Liability  Breakdown – Pay on Use

 Unauthorised Movement  Emergency Helpline

 Unauthorised Use  Claims Reporting Online

 Unlicensed Drivers  Own Repairs Authorisation

 Towing  Recommended Repairers

 Attached Trailer Cover  Repairs Guarantee – Bodywork  Detached Trailer Cover  Repairs Guarantee – Period (Years)  New Vehicle Period – Cars (Months)  Vehicle Rescue Cover

 New Vehicle Period – GCV (Months)  Accident – Transport

 New GCV – Max Weight (Tonnes)  Accident Transport – Maximum Distance

 New Vehicle (%)  Accident – Maximum Passengers

 New Vehicle Mileage Limit  Message Relay

 Windscreen Limit  Alternative Transport Costs (£)

 Windscreen Limit Non-Approved Repairer  Emergency Accommodation Limit Per Person (£)  Audio limit – Manufacturer  Emergency Accommodation Total (£)

 Audio Limit – Non-Manufacturer  Courtesy Private Car  Satellite Navigation Limit – Manufacturer  Courtesy Car Defined Class  Satellite Navigation Limit – Non-Manufacturer  Courtesy Car Period (Days)  Loss of Keys Limit (£)  Courtesy Car Guarantee  Theft of Keys Limit (£)  Courtesy Car Enhanced Vehicle

 Personal Effects  Courtesy Car Total Loss

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Proposed criteria

 Courtesy GCV Period (Days)  Inexperienced Driver Excess  Courtesy GCV Defined Class  Windscreen – Replace Excess  Courtesy GCV Guarantee  Windscreen – Repair Excess  Driver Under 21 Excess  Cancellation Return Level