As the coronavirus pandemic brings bad news to us every day, especially to the finance world. In the latest turn of events, UK car finance groups have been reporting an increase in motorists that are seeking relief on auto insurance loans during the coronavirus lockdown. This follows concerns about a wave of defaults across the insurance finance sector. Calls to UK insurance lenders have risen 20-30 times the normal levels. This news comes from the Finance and Leasing Association, the industry body for automotive finance providers.
Increased Customer Calls – Pressure on Insurance Providers
UK Insurance providers that offer motor, consumer or equipment loans experienced a 1,400 % increase in the amount of calls from worried customers who may be unable to pay their insurance loans; this was only during the first week of the UK lockdown. In the following week of the UK lockdown, volumes rose 200% and held constant in the third week, according to the Finance and Leasing Association. The head of motor finance at the Finance and Leasing Association, Adrian Dally, said ‘there has been a very significant percentage increase in call volume going into member companies’ and ‘this is causing very significant operational pressures.’ The increased pressure on UK motor loan insurance providers is just another of the bad news that the coronavirus lockdown has brought to the UK and to the world.
Relief Measures for Insurance Customers
Some UK car lenders have already started granting relief to motorists. Black Horse, one of the UK’s largest motor finance companies, said that it has already given more than 60,000 payment holidays. These make a considerable impact on people’s overhead expenses during the UK lockdown, and the extended period that the coronavirus will affect the world.