What’s Driving Total Loss Frequency?

Analysis of vehicle claims data for 2015 to date shows the rate at which vehicles are being totaled versus repaired has risen for the industry. Susanna Gotsch examines the factors driving this increase, and when can we expect to see it start to trend down.

With more vehicles falling into the older ages, and with more vehicles with repair costs that reach higher percentages of the loss vehicle ACV due to either higher repair costs or more extensive damage to the vehicle overall, more vehicles overall are being totaled. The good news is that strong new vehicle sales are continuing to ramp up the share of vehicles on the road in the U.S. that are newer and where the value of the loss vehicle is higher and harder to reach from a repair cost perspective.

While the hangover of older vehicles will continue to keep total loss frequency elevated in the near future, the good news is longer term as the fleet becomes newer it will begin to come down again.

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