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CCC Q1 data: Claim counts down nearly 1%; severity, total loss value up

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Education | Insurance | Market Trends | Repair Operations | Technology
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Collision repairers and auto insurers year-over-year saw 2.3 percent fewer repairable claims and 0.9 percent fewer claims overall in the first quarter of 2019, based on CCC data reported last month.

However, CCC estimates indicate the average repairable collision and liability vehicle severity rose 3.9 percent for the year ending March 31, and the average totaled vehicle value climbed 4.9 percent.

Totaled vehicles represented 19.1 percent of all claims in the first quarter, up from the prior year and way up from the 14 percent recorded in 2013.

The data provides a means of comparing one’s facility against the market. It also suggests the average shop is receiving less work but potentially bringing in more revenue per repair order.

However, the increase in repair bills might not always translate into greater shop profitability. CCC’s data found more parts replaced, which can mean fewer higher-margin labor hours — the main way repairers make money.

Auto body shops replaced 10.12 parts per collision/liability claim in the year ending March 31, up from 10.01 in the year ending Dec. 31, 2018, and nearly an entire part more than was replaced in calendar year 2014, according to CCC.

In comparing the year ending March 31, 2015, to the year ending March 31, CCC saw parts and subletting/miscellaneous costs making up a greater proportion of the increase in severity than labor did.

“Analysis of the components of the average vehicle repair cost, and the increase experienced by the industry over the last five years reveals well over 40 percent of the increase has come from more replacement parts, followed by labor costs, and costs rolling up under the miscellaneous/sublet category,” CCC director and industry analyst Susanna Gotsch wrote in May.

Calibrating advanced driver assistance systems and scanning vehicles probably has something to do with the rise in “‘miscellaneous/sublet.'”

For example, the proportion of repairable appraisals with at least one line item related to “Scan/Health/asTech/Diagnose/OBD” reached the 40 percent threshold in the first quarter, up from single digits in the first quarter of 2016, according to Gotsch’s report. The average line item was $65, she reported in a May video accompanying the report.

More information:

“Industry Trends with Susanna Gotsch – May 2019”

CCC YouTube channel, May 1, 2019

“1st Quarter 2019 CCC Industry Update”

CCC, May 2019

Images:

CCC director and industry analyst Susanna Gotsch discussed repair cost factors in a May 2019 video. (Screenshot from CCC video on YouTube)

CCC in May 2019 reported parts, labor and miscellaneous/sublet costs made up much of the increase in repairable loss severity seen over the five years ending March 31, 2019. (Provided by CCC)

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