The National Body Repair Association in the UK has issued a direct plea to insurers for increased bodyshop support in 2021. Without this, it says many repairers will go out of business leading to a serious capacity shortage in the long term.

The comprehensive statement by the NBRA details the challenges repairer’s face, many of which will be reflected in the Irish bodyshop sector.

Government lockdowns mean claims volumes are once again expected to plummet in first quarter of 2021 with the NBRA expecting them to be 50%, or less, of pre-covid levels. Faced with this, Chris Weeks, Director of NBRA, has issued a plea to 60 senior Insurance and Accident Management figures for more support.

He highlights how cashflow issues are causing many repairs to hang on by “the skin of their teeth” and how government supports often do not apply to bodyshops who continue to provide a service.

While making the point that some work providers did provide additional support to bodyshops in the first lockdown of March 2020, he questions whether this will again be forthcoming and explores the consequences of increased bodyshop closures.

He suggests that the market could lose 25% of its capacity due to closures and that as restrictions are lifted and demand for repairs increases, this would mean repair costs rise. A reduction in the number of repairers would also be compounded by a serious skills shortage as technicians find work in other industries. Skilled technicians left would also demand higher wages meaning more repair cost inflation.  

Chris also makes the valid point that with reduced capacity there is a real possibility of service level issues, delays and reduced quality. A highly consolidated repair industry would also mean less choice for underwriters.

With 2020 being a very good year for insurers as claims volumes have been very low, the NBRA is calling on the insurance industry to ease the profit squeeze on bodyshops. In particular it suggests;  

• Removing parts discounts from repairer contracts

• The use of approved non-OE parts (and recycled where appropriate) at VM retail cost

• Removing (or reducing) paint discounts from repairer contracts

• Repairing (where safe) up to 100% of vehicle value (especially as replacing vehicles under Covid restrictions is difficult and unsafe)

The NBRA is also calling for annual contract terms reviews, something that repairers are generally reluctant to suggest because of the power imbalance in the repair-insurer relationship. It would also like to see more flexibility when it comes to approving engineered repair solutions.