Leading specialist loss adjuster QuestGates has issued a word of warning to the insurance industry that the new Highways England process for dealing with ‘Green Claims’ shows a hardening of approach by the government company that could result in both increased litigation and claims costs.
Responsible for maintaining the nation’s motorway and major A road infrastructure, Highways England has just announced changes to their process for dealing with claims against motorists and their insurers, in regard to claims for damage to Crown property following a vehicle accident, known as ‘Green Claims’.
“The insurance market has had its concerns about the lack of transparency around the calculation of ‘Green Claims’ for years now as repair costs can vary significantly, dependant on the location, damage and entity making the recovery. Both insurers and loss adjusters have raised many challenges in relation to the charges applied to such repairs,” comments Stuart Lansdown, Divisional Director Third Party Services at QuestGates.
The new process involves the introduction of a National Schedule of Repair Costs (NSoRC), which Highways England claims will harmonise repair rates across their various regions.
Under the new arrangement which applies to claims below £50,000 for barrier/surface damage and £20,000 for signage, lighting and fencing, the charges will be fixed according to the NSoRC and recovered by Highways England directly. Total claim costs will be derived from the number of nine or 12 hour shifts required to effect a repair plus materials and repairs needing to be completed within a short timeframe will attract higher rates than those that can be programmed into routine maintenance.
QuestGates Principal Engineer, Kelvin Zitha, says: “While we welcome the effort to bring greater clarity and consistency to the process, the industry should be alert to the fact that the announcement of these changes also comes with the clear message that the new rates are not up for negotiation. There is potential for increased litigation and so increased claim costs in the event the scope of repairs cannot be agreed.
“Until we start to see the process in practice, it’s difficult to summarise what the overall impact of the NSoRC will be on insurers and it remains to be seen if the average cost per claim is reduced. What we can expect to see is it taking longer for claims to be presented post accident. There will be no less need for careful scrutiny of the claims presented in order to validate the scope of the repair undertaken, the time spent and the type and quantity of materials used.”