Potholes and the customer...The WHO2 view

THE WHO2 GLOBAL VIEW

POTHOLE DAMAGE IS NO LONGER NOISE IN THE MOTOR BOOK.

It is a line item.

For years, pothole damage sat in the annoying but immaterial category. A tyre here. An alloy there. A customer grumble. Nothing strategic.

That is not what we are seeing now. 

Through Benchmarq360, reviewing live broker and insurer motor data across multiple books, pothole related damage has shifted from sporadic to structural.

This is no longer a winter spike. It is frequency.  

WHAT WE ARE SEEING IN THE DATA

Across private car and Van portfolios we are benchmarking:

• Increased frequency of tyre and wheel related claims

• Higher average repair costs due to modern alloy design and suspension complexity

• More mid value claims sitting just above excess levels

• Growing numbers of customers choosing not to claim on core motor policies

That last point is important.

Customers are protecting their No Claims Bonus.

The damage still exists. The risk still exists. But it moves off book. It becomes friction, dissatisfaction, and out of pocket expense.

And that behaviour shift matters for brokers and insurers alike. 

THE NCD PROBLEM

When a customer hits a pothole, they face a decision.

Claim on comprehensive cover and risk:

• Excess cost

• Potential Loss of NCD and/or protection 

• Potential premium increase at renewal

Or absorb the cost themselves. Some are choosing the second option.

From a pricing and retention perspective, that creates distortion:

• True road condition exposure is under reported

• Loss ratios look cleaner than the lived customer experience

• Renewal friction increases quietly

We are seeing books where this type of damage is becoming one of the most common non reported but paid loss experiences. That should interest any motor product owner.

WHY THIS IS BECOMING STRATEGICALLY RELEVANT

UK road conditions are not improving at the pace vehicle technology costs are rising.

Modern vehicles have:

• Larger alloys

• Lower profile tyres

• More complex suspension systems

• Higher repair and calibration costs

A pothole event in 2026 is not the same as it was in 2016.

From a portfolio management perspective, this is now predictable attritional loss behaviour. Which makes it a design question. 

THE ADD ON SOLUTION

Specialist pothole, tyre and alloy protection products sit outside the core motor policy.

That means:

• Claims do not impact the main motor NCD

• Lower excess structures

• Defined repair or replacement limits

• Clear claims pathways

For customers, it removes the dilemma. For brokers, it reduces any renewal resentment and create ancillary revenue. For insurers, it can protect core loss ratio, improve retention, create ancillary revenue, and provide a better customer proposition.

The Customer wins. 

WHY BROKERS AND INSURERS SHOULD BE LOOKING AT THIS NOW

If you are:

• A broker with a large Personal lines / Commercial motor book

• An insurer reviewing frequency creep in attritional damage

• A capacity provider focused on NCD protection behaviour

• A product owner looking for defensible ancillary value

Then pothole protection is no longer a peripheral conversation. It is a portfolio design conversation.

Through Benchmarq360 we are already seeing material differences in performance between books that have structured ancillary strategies and those that treat add ons as an afterthought. 

This is not about selling a tyre policy.

It is about customer lifetime value, renewal stickiness, behavioural economics around claiming, and honest risk alignment and again, protecting the customer. 

THE WHO2 POSITION

We do not underwrite or sell pothole damage cover ourselves.

But we do work with partners that can provide a well structured solution.

More importantly, we can help you understand whether your book actually needs it, what the frequency data says about your exposure, how to position it commercially and compliantly, and whether it improves value or just adds noise.If you are a broker or insurer and this resonates with what you are seeing in your motor data, please, have a conversation.

The roads are not improving.

The frequency trend is not reversing.

The question is whether product design is keeping up.

Talk to us or someone else, but, please explore it. The customer deserves it.

The views expressed in this article are those of WHO2 Global Ltd and do not constitute professional advice. All content is for informational purposes only.