Silent gaps, loud consequences: when suppliers fail to hear what customers aren’t saying

In the motor claims journey, silence isn’t golden – it’s costly. With 40% of annual motor claims coming from first-time claimants, and as many as 1.2 million customers potentially falling into the category of ‘Vulnerable Customer’ each year, the stakes for clear, compassionate communication have never been higher.

These individuals aren’t just navigating repairs or total loss decisions – they’re navigating confusion, stress, and often fear.

Suppliers, as the human face of the claims process, have a unique opportunity – and responsibility – to listen actively, interpret the unspoken, and respond with empathy. When they don’t, the consequences echo far beyond the garage floor, damaging trust, loyalty, and the insurer’s reputation.

Just imagine a scenario.

Have you ever done anything so far outside your normal daily life as to leave you feeling confused, uncertain, a little fearful maybe, feeling ‘lost’, hesitant, worried? Perhaps you decide to go skydiving, start a new job, move house. Something you may even have done before but which, nevertheless, is not something that you encounter very regularly.

For some of those making a claim on their motor insurance policy – especially vulnerable customers – this is exactly how they feel.

We don’t want to exaggerate the negatives, but the average policyholder will make a claim only every 15 years or so, and in any single year for 40% of claimants this will be their very first experience of embarking on the claims journey.

This 40% of claimants amounts to some one million people annually. Even the remaining 60% of claimants are not exactly experts unless, of course, they are professional criminals seeking to game the system.

So, we can be fairly sure that large proportions of the customer base of the average motor claims department are inexperienced, lacks comprehension, and will find the journey confusing at best and traumatic at worst.

We all know the language and the shorthand that we use daily.

What exactly is an excess? Who is the third party? What is this credit hire arrangement you don’t want me to have but the last person I spoke to said it was OK? If I’m entitled to a ‘courtesy car’ then why can’t I have it now?

Of course, there will also be the cohort of claimants who find the whole process easy, straightforward, and of little emotional consequence. For this group even the inefficiencies of their claims journey (if they exist) will barely register on the Richter Scale of disturbance and inconvenience.

But that is not the situation for many of our customers.

Loss without limits

We also know that 560,000 vehicles are written-off annually by insurers.

Aside from losing your mobile phone there can be few things more inconvenient – and potentially costly – as having your vehicle written-off after an accident. The trauma may not lie in the realms of personal injury or a similar condition but the simple realisation and massive problems you may now face as you are suddenly without transport and, even worse, your vehicle will not be returned in a couple of weeks having been fixed and valeted.

The volume of vehicles being declared a total loss amounts to a 46% increase in the period from 2017 to 2024, but the car parc has only grown by 6.4% in the same period. A vehicle being written-off is becoming more frequent and affecting more and more of those first-time and less experienced claimants whom we can surely describe as being traumatised by the unexpected and unwanted loss of their vehicle.

The basic motor policy is unlikely to cover you for a courtesy car if your vehicle is declared a write-off and that proposed trip to the shops, the doctors or, of course, getting to and from work is looking more vexatious as every minute passes.

There are also the potential financial issues.

In today’s world of PCP (personal contract purchase) financing of vehicle purchases it can also mean that you now have to find monies to pay off negative equity. For most of the life of a PCP contract the value of the vehicle is less than the amount outstanding as vehicle values depreciate at a faster rate than the finance is being redeemed.

As well as funding this shortfall you are now faced with the fact that you have to buy another vehicle and even the very generous PCP deals that are available may still require you to find a capital sum simply in order to keep the monthly payments at an affordable level. The average cost of a used vehicle purchase in 2024 was £16,500 which is a considerable sum of money for most people to find. Even a seven-year-old Ford Mondeo is currently advertised at circa £7,500

Vulnerability at the core of claims

According to the Chartered Insurance Institute (CII) it can be estimated that circa 50% of motor insurance claimants are anticipated to be a Vulnerable Customer within the definition prescribed by the FCA (Financial Conduct Authority).

Namely, that the claimant demonstrates one or more vulnerable characteristics in the categories of health conditions, life events, low financial resilience and/or limited capability. This would amount to circa 1.2 million motor claimants annually or 100,000 per month if this figure is true. In a recent survey of firms’ practices, the FCA determined that the policies and practices of identifying and dealing with Vulnerable Customers is not yet fully embedded in everyday work with a range of problems including lack of adequate communication, lack of tailored support and inadequate monitoring.

At a very simple level, five million people in the UK do not class English as being their first language. A potential recipe for miscommunication and misunderstanding when it comes to the entirely unfamiliar process of making a claim on a motor insurance policy.

Suppliers must deliver fair outcomes

Perhaps the most telling intervention of the authorities in recent times is the invention of Consumer Duty principles which followed on from its predecessor, the prescription to Treat Customers Fairly. The overarching expectation for conduct and customer-centricity of the Consumer Duty is that firms must act to deliver good outcomes for retail customers. In the field of claims this has been applied to subjects as diverse as customer service, communications, fair financial settlements, handling of complaints, and more.

Fundamentally we all need to be looking at both what we do, and how we do it, with the best interests of the customer firmly anchored in our thoughts, words, and deeds. Arguably, there is nothing especially revolutionary about this approach to business but the FCA is of the view that more needs to be done, and it is clear that the claims sector does not yet have all the necessary standards in place.

We are all fond of management information (MI) that tells us how well the contact centre is working and the effectiveness of claims handling processes. The FCA however, opines that there is insufficient focus on the outcomes of these practices and how Vulnerable Customers are managed within these metrics.  

Specifically, there is an observation that the oversight between client and third-party supplier is not always well-managed and more needs to be done to ensure that there is a consistency of delivery by all the providers of claims services.

Closing gaps, protecting vulnerability

To truly meet the expectations of the Consumer Duty and our responsibilities to claimants, firms must go beyond surface-level compliance and embed vulnerability into every layer of the claims journey.

This means proactively identifying silent signals, adapting processes to individual needs, and ensuring that suppliers – whether internal teams or third-party partners – are aligned in delivering fair, consistent outcomes.

Closing operational and oversight gaps isn’t just good governance; it’s a moral imperative. When vulnerability is treated not as an exception but as a central design principle, the industry moves closer to a claims ecosystem that is not only efficient, but equitable.

Eddie Longworth
CEO
e2e Total Loss Claims Management