The number of warranties sold for 10 to 20-year-old cars has risen by 67% since the pandemic, according to the RAC Dealer Network.
In 2020, 6% of all policies sold through its 1,200 used car retailers were for vehicles in this age range but during the first six months of this year, it had risen to 10%. Similarly, the number of claims in this category have risen from 15% to 21% of the overall total made.
There has also been a marked 34% increase in warranties sold for 5 to 10-year-old cars over the same time period, rising from 34% to 46%. Claims have comparably increased from 61% to 65%.
Conversely, there has been a fall in activity in the 3 to 5-year-old age range, with a decrease in warranty sales from 35% to 33% of the overall total, and a reduction in claims made from 23% to 14%.
Lee Coomber, RAC client director at Assurant, which partners with the RAC in the warranty and aftersales sector, said: “These figures show how post-pandemic vehicle shortages and the subsequent ageing of the car parc are having an increasing impact on warranty claims, with a marked shift towards the upper end of the age ranges in which we offer cover.
“As has been widely reported, dealers are finding themselves in a situation where they are selling more aged vehicles, a development that looks set to continue for some time to come. What has been less widely covered is the role that warranty providers such as the RAC and Assurant have played in helping them through this shift, providing the cover that car buyers desire even though claims on older vehicles are obviously higher and more costly.
“Warranties have, we believe, become much more important as consumers find themselves buying cars that tend to be older and more expensive in the post-pandemic market. Our claims figures illustrate the way in which we are supporting this trend.”
The RAC Dealer Network consists of more than 1,200 used car retailers across the UK offering a range of RAC-branded products - including warranties, service plans and more - created in conjunction with Assurant, a Fortune 500 company.
Press office contacts and interviewee availability
RAC press office: [email protected]
ISDN/Skype/FaceTime or conventional phone interviews are available with RAC spokespeople.
About the RAC
The RAC, an iconic UK brand, provides complete peace of mind to 13 million UK private and business drivers, whatever their motoring needs. As well as its premium nationwide breakdown assistance service – with an expert branded patrol workforce attending more than two million breakdowns every year – it offers a wide range of market-leading products across insurance, legal services, vehicle inspections and service, maintenance and repair. The RAC is also at the forefront in helping drivers make the switch to electric vehicles and leads in the development of new solutions for businesses and OEMs, partnering with the best in the motoring and mobility space.
Assurant, Inc. (NYSE: AIZ) is a leading global business services company that supports, protects and connects major consumer purchases. A Fortune 500 company with a presence in 21 countries, Assurant supports the advancement of the connected world by partnering with the world’s leading brands to develop innovative solutions and to deliver an enhanced customer experience through mobile device solutions, extended service contracts, vehicle protection services, renters insurance, lender-placed insurance products and other specialty products.
For press enquiries please contact:Simon Wells at Paperchase PR on 07768 912430 or e-mail [email protected]