From a claims severity and frequency perspective, hybrid vehicles represent a more costly overall risk to insure than their gas only powered cousins, according to Greg Horn, Mitchell International Inc.'s VP of Industry Relations.
Horn’s comments are based on the company’s third quarter 2010 edition of its Industry Trends Report (ITR). The report indicates that hybrids have a 6.5% or $182 higher average claim severity than gas-powered counterparts.
The high claims costs are a result of high repair costs. According to the report, the mechanical labor charges for hybrids are notably higher than the normally aspirated vehicles. And hybrid vehicle claims utilize 91.9% original equipment manufacturer parts dollars compared to 86.8% for gas-only counterparts.
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