During the most recently closed quarter, the average length of time consumers needed to use a rental car following an auto accident increased by nearly five days compared with the year prior, according to car rental company Enterprise Holding, Inc., which reported the average rental period was 18.2 days during 2022's first quarter. Enterprise noted issues around staffing at repair shops, parts availability, vehicle prices, inflationary pressures and new claims processes are teaming to push up the average length for rental cars following a collision claim. Greg Horn, chief innovation officer for PartsTrader, said in a release: "We saw a record high of the median delivery days for all part types. We measure the median plus two standard deviations to capture the complete picture of all parts needing to be replaced. What we saw in the first quarter of this year is a median score of 15.6 days for the outliers. This is double of the median delivery days (plus two standard deviations) for the outliers that we saw in Q1 2021." Claims involving a drivable vehicle saw the average length of rental (LOR) increase around four days compared with the year prior, with the average rental period stretching 15.5 days in the first quarter of 2022. For claims involving nondrivable vehicles, the average LOR increased more than a week in the first quarter, according to Enterprise, with the average rental period lasting around 26 days. For claims involving a total loss, the average LOR was 18.4 days, up 4.1 days from the same period in 2021. Ryan Mandell, director of claims performance for Mitchell International, explained this trend is expected to continue. "As actual cash value rise, we can expect total loss frequency to decline as more borderline losses are deemed to be more economical to repair," Mandell said in a release. "This has been the case in the U.S., which saw a 16.1% total loss frequency in Q1 2022, compared to 17.2% in Q1 of 2021. Such a scenario could impact shop capacity, especially in the face of a tight labor market, and drive keys-to-keys cycle times even higher." Enterprise noted that no U.S. region was immune to the increases seen in car rental periods. However, some states did stand out and the above slideshow highlights the states that saw the longest average LOR in Q1 2022. Related: |
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.