Personal injury/B.I. claims frequencies down slightly, but severity highest in a year

Canadian 2008 Q3 casualty statistics show a slight decrease in Personal Injury Protection (PIP) claims — i.e. no-fault claims for medical expenses and payments for wage losses — and yet the severity of such claims was the highest recorded in a year, according to statistics published in the 2009 Q1 Mitchell Industry Trends Report.
Similarly, the frequency of bodily injury (BI) claims decreased slightly in 2008 Q3, but the severity of such claims was the highest recorded in a year.
The industry trends report calculates the 12-month rolling average for nationwide PIP claims as a percentage of such claims reported per 100 insured exposures.
In 2008 Q3, the PIP frequency was 1.36, slightly down from the 1.38 figure reported in 2008 Q2 and the 1.44 figure reported in 2007 Q3.
Mitchell says the slight decrease is “likely” due to reduced driving as a result of high fuel costs.
Still, the average severity of nationwide PIP claims in 2008 Q3 hit Cdn$8,153 per claim, “the highest quarterly severity recorded,” the report notes.
For bodily injury claims, the 12-month rolling average for nation-wide bodily injury claims was down 0.94%, down from previous quarters. Again, Mitchell attributes the drop to decreased driving as a result of high fuel costs.
At the same time, the severity of the average BI claim increased to Cdn$11,589 in 2008 Q3, up from Cdn$11,427 in the previous quarter and Cdn$10,956 in 2007 Q3.
The trend of increased B.I. severity reflects “medical cost inflation,” the report notes.