Insurance association studying ‘worrying’ spike in motor accidents

Insurance association studying ‘worrying’ spike in motor accidents
TODAY file photo
Published: 4:00 AM, March 15, 2017
Updated: 5:09 AM, March 15, 2017

SINGAPORE — The number of motor accident reports increased by almost 8 per cent last year, hitting an eight-year high, despite a falling vehicle population.

There were 161,361 reports last year, compared with 149,511 in 2015, the General Insurance Association (GIA) said yesterday at a briefing on the industry’s annual performance. This was the highest since 2008, when there were 168,935 reports.

The total vehicle population has been declining since 2013, based on data from the Land Transport Authority (LTA).

Last year, there were 956,430 vehicles altogether on the roads, compared with 957,246 in 2015.

The GIA said it was a concern that the number of motor accident reports has increased, following a downward trend in recent years.

“While we do not have any conclusive evidence, we suspect that the surge in accident reports could be due to the increased number of private-hire cars,” said GIA president Mr A K Cher.

“We will be taking a deeper look as to which category — whether motor bikes, commercial vehicles, private cars or private-hire cars — contributed the most to this (spike), and we will then accordingly engage the industry stakeholders and LTA to try to improve the situation,” he said.

Ride-sharing services such as Grab and Uber have added substantially to the fleet of private-hire cars on the road in recent years.

Private-hire cars are more likely to be involved in traffic accidents than other passenger cars because of the lower average age of drivers and the long hours spent behind the wheel, said an insurance broker who did not want to be named.

But he added: “Even if premiums go up for the private-hire car industry, it will not affect the general motor insurance premiums for passenger cars, which are assessed separately.”

In response to queries from TODAY, a Grab spokesperson said that “while we are not in the position to comment on the private-hire vehicle industry, we can share that accident rates involving GrabCar driver-partners are low, based on our internal records”.

All private-hire car drivers are required by law to have compulsory third-party liability insurance and commercial motor insurance.

“For Grab, we go the extra mile by offering all GrabCar driver-partners an additional insurance policy called the Personal Accident Insurance, provided at no cost to them,” said the spokesperson.

Uber reiterated that it requires all vehicles operating on its platform in Singapore to have compulsory auto insurance.

Meanwhile, GIA statistics showed that the proportion of accidents involving foreign vehicles last year remained at 2.5 per cent of total accidents reported, even though the number went up to 4,266 in 2016, from 3,815 in 2015.

However, incurred claims fell by 8.5 per cent to S$494.4 million last year, from S$540.1 million in 2015, despite the rise in the number of accidents reported.

This was attributed to a better claims-handling protocol adopted by insurers, principally driven by the Motor Claims Framework, said the GIA.

The framework has a three-step action involving the exchange of personal particulars, calling the insurer for towing services and filing a report to the insurer within 24 hours.

This includes taking photos of damaged vehicles at the accident scene.

In addition, there are now proactive investigations into alleged fraudulent claims.

Motor industry premiums, meanwhile, remained stable last year, with the average motor premium at S$1,202, given more choices for motorists with several new entrants in the market, the GIA said.

Overall, the motor insurance industry was profitable, with an underwriting profit of S$87.4 million.