TREND 5
Claim cycle times improve against elevated attorney representation rates

Claim Frequency

After years of hardship, 2024 brought some small signs of relief, and progress, to the world of claims. Some of the externalities that have plagued claims leaders appear to be moderating. The CPI for Urban Consumers for Motor Vehicle Parts in 2024 remained flat to 2023 after two years of precipitous increases. The cost of medical care returned to its normal historical patterns as well, even as it increased 2.7% from the end of 2023 to the end of 2024.¹

Bodily injury (BI) frequency stayed put at 1.0%, where it has been for multiple consecutive quarters, but Collision (CO) and Property Damage (PD) frequency declined. CO frequency moved from 7.8% in the first three quarters of 2023 to 7.3% in the same period in 2024. Given that CO frequency remained at 8.0% or higher for much of 2022, this decline is now a trend. Property damage frequency also declined, moving from 4.1% in the first three quarters of 2023 to 3.9% over the same period in 2024. This coverage has not seen a frequency below 4% since Q1 of 2021.

_{¹U.S. Bureau of Labor Statistics via FRED®}

_{Source: LexisNexis® Risk Solutions internal data, 2025}

Claim Severity

BI severity did have a sharper trend upward, increasing 9.2% year over year as of the end of Q3 2024. Between 2023 and 2024, CO and PD severity changes were far more moderate. Collision ended Q3 2024 down year over year (-2.5%) with PD finalizing the same quarter up 2.5% in a year-over-year comparison.

BI severity did have a sharper trend upward, increasing 9.2% year over year as of the end of Q3 2024.

_{Source: LexisNexis® Risk Solutions internal data, 2025}

Total Loss Claims Continue to Climb

Declining collision severity is even set against a backdrop of further increases in total losses. In 2024, the percentage of collision claims deemed a total loss increased almost two percentage points, bringing the overall total loss percentage to 29%. Falling used vehicle prices have likely contributed to this dynamic, with used vehicle prices declining 5% from the end of 2023 to the end of 2024 while new vehicles prices flattened out over that same period.

Now with almost 30% of collision claims ending in a total loss, carriers need to place an even greater focus on speed and customer satisfaction in this process, especially since our research shows that approximately 40% of vehicles with full coverage (liability and physical damage) opted to purchase rental reimbursement coverage.

Almost

30% of collision claims

end in a total loss.

Days to First Pay Improves

Even more encouraging is the positive change in Days to First Pay between 2023 and 2024. BI Days to First Pay hovered just above 58 in the first three quarters of 2023, but that dropped to just over 57 in the same time period in 2024, a change of -2.0%. For collision, Days to First Pay moved from 35.6 days through the first three quarters of 2023 to 33.5 over the same period in 2024 —a 6.1% reduction.

Property damage moved from 50.5 days in the first three quarters of 2023 to 47.2 days for the same period in 2024 — a 6.7% reduction. While it is hard to ascertain the exact cause, parts and vehicle availability, moderating frequencies and a continued focus on automation, likely contributed to these declines.

_{Source: LexisNexis® Risk Solutions internal data, 2025}

Customers Report Positive Customer Experience with Attorneys

One trend that remains concerning is attorney representation in claims. Both the incidence of representation and the sophistication of the plaintiff’s bar remain serious concerns for claims leaders. With attorney representation dominating industry headlines in 2024, LexisNexis® Risk Solutions commissioned a study to learn more about the experiences consumers have with their attorneys and with third-party insurers.

One trend that remains concerning is attorney representation in claims.

Chart A

^{LexisNexis® Risk Solutions, Internal Claims Consumer Research, copyright@ 2024}

Among 1,000 consumers who had experienced a BI claim within the past two years and filed a claim with the other driver’s carrier, we found that 15% did not initially plan to seek counsel. However, 61% reported that something happened with the other driver's carrier that drove them to do so (Chart A).

Chart B

^{LexisNexis® Risk Solutions, Internal Claims Consumer Research, copyright@ 2024}

Compounding the ease with which consumers moved to attorneys is the customer service the attorneys offered. When consumers compared their attorney experience to what they underwent with the third-party carrier, plaintiffs outperformed adjusters in key areas (Chart B).