Thatcham Research announces the impending introduction of ‘Insurance Industry Requirements’ for those involved in the repair of vehicles equipped with Advanced Driver Assistance Systems
Glyn Thompson looks at the changes Thatcham Research have brought in on Insurance Industry Requirements.
What the Insurance Industry Requirements (“IIR”) says
Thatcham Research this week announced that, as from 31 March 2021, those of its member insurers involved in the repair of vehicles fitted with Advanced Driver Assistance Systems (“ADAS”) shall be required to consider whether a vehicle is fitted with ADAS sensors, parts likely to affect the operation and functionality of ADAS sensors, or vehicle geometry. If so, repairs to that vehicle will need to be carried out to ensure that inspection, realignment and calibration of those elements are undertaken and in such a manner as to ensure that the manufacturers’ technical specifications are met to reinstate the ADAS features safely, without compromising performance.
ADAS is an umbrella term for the automated technology systems incorporated into vehicles and designed to assist drivers in driving and parking functions. The complexity and divergence of those technologies, coupled with competing views as to when such systems require inspection, realignment and collaboration following an accident has long been a cause for tension and inconsistency across the industry. The IIR is designed to bring clarity and uniformity of process to the industry.
Requirements for insurers
In short, the IIR requires insurers, in particular, to ensure the ability of any repairing organisation it uses to manage the complete repair process, including calibration where required. Insurers should therefore:
- Communicate their requirements for compliance with the IIR to any contracted repairer
- Have their contracted repairer establish at triage, wherever possible, if ADAS is included on a vehicle
- Only direct work within their network to repairer’s capable of meeting the IIR.
Requirements for repairers
Those undertaking the repair work should:
- Ensure they have the required capability, through investment in appropriate equipment and training, to comply with the IIR or have an appropriate outsourcing procedure, that ensures all work meets the requirements
- Research and seek guidance from relevant repair instructions and inspection, realignment and calibration instructions
- Ensure all inspection, realignment and calibration activities are completed by a competent person
- Complete system inspection, realignment and calibration in accordance with the relevant repair procedure and vehicle manufacturer’s technical specification
- Be able to demonstrate that the calibration of all affected sensors has been completed and the results of the calibration confirms functionality of the sensor within the vehicle manufacturer’s technical specification.
What impact on premiums?
Established by the motor insurance industry over 50 years ago, Thatcham Research was created with the specific aim of containing or reducing the cost of motor insurance claims while maintaining safety standards. To that end, industry guidance and instruction such as IIRs are designed to ensure uniformity of safety outcome, repair method and standard and so insurer outlay and fairness; there can be no obtaining advantage through the application of less than optimum repair methods. But ensuring such high standards of repair to guarantee best safety outcome appear to come at increasing cost.
As we entered 2020 the Association of British Insurers reported that its ‘Motor Insurance Premium Tracker’ - being the only survey that looks at the price consumers actually pay for their cover, rather than the price they are quoted, revealed that the average premium paid by UK motorists in 2019 was £471, the third highest annual figure on record.
There will be several factors contributing to that situation, not least of which being the change in the discount rate and the increase in IPT, but increased repair cost due to increased technology within vehicles may be one factor.
In 2018 the government paved the way for the UK to be a world leader in assisted and automated driving systems with the introduction of The Automated and Electric Vehicles Act 2018. It is therefore unsurprising that premium levels rose to such levels in the following year.
Most vehicles produced today already contain some level of ADAS technology, such as automatic emergency braking systems, but Thatcham Research predicts that the pace of change over the next five years will be swifter than at any point in its existence. Increased repair costs therefore seem inevitable. But the industry’s faith in the standards set and instructions given by Thatcham Research is, and should, remain as strong as ever. Its introduction of Euro NCAP tests for whiplash and AEB helped, in combination with transport initiatives, government policy and vehicle specifications, reduce fatalities on UK roads between 1997 and 2017 from 3,599 to 1,793, making them among the world’s safest.
Further safety improvements are predicted with Thatcham Research projecting a 5% decrease in the number of serious collisions on UK roads between 2019 and 2025. So whilst repair costs on an individual claim basis seem likely to increase, following such guidance as this latest IIR is still the road to follow if improved safety and overall premium reduction remain the destination.