Auto Claims Are Up—But Your Loss Ratio Doesn’t Have to Be

Since 2020, auto lenders have faced a new reality: claims are rising, and they are more expensive than ever. In fact, we have seen skip claims alone are up 49% in volume and 32% in average severity. Translation: there are more claims, and they cost more to resolve.

Behind the numbers are familiar forces like economic strain on certain borrower segments, plus increasingly sophisticated fraud. And while no one expects those trends to ease soon, Lee & Mason has taken a different approach. Instead of passing losses through in the form of rate increases or higher deductibles, we have rebuilt our claims program to protect your portfolio.

Does your loan portfolio need better protection? Contact our team for a personalized claims overview.

The Challenge: Higher Risk, Higher Stakes

For many lenders, traditional claims programs were not designed to handle today's frequency and severity. Vehicles slip through the cracks at auction, recoveries stall, and losses snowball into pricing shocks.

That's why we asked ourselves, "What would it take to consistently lower net losses before and after any claim payment so lenders can keep programs stable, even in a tougher environment?"

Our Answer: A Claims Approach Built for Performance

We re-engineered our strategy with one goal: to help lenders reduce their loss ratio and keep their rates stable. That means fewer claims hitting your policy and more recoveries flowing back as positive credits to the policy.

1. Stronger Skip Tracing & Vendor Management

Multi-vendor model with defined Service-Level Agreements (SLAs) and escalation rules.
Data discipline: address perfection, VIN/title confirmation, and real-time reporting
Hands-on QA to drive accountability and results.

The Result: About 70% of skip claims close with a positive resolution (vehicle located, redeemed, or recovered), which roughly doubles what many clients reported before working with Lee & Mason.

2. Persistent Post-Claim Recovery

Even after a claim is paid, we keep searching.
Any recoveries flow back as offsets to your loss ratio. Over the last 12 months, that has amounted to ~$7M in recoveries for our clients.

3. Smarter Remarketing

Specialists managing transport, condition reporting, and sales channel optimization.
Focused not just on hammer price, but on net proceeds and cycle time.

The Result: Since 2020, we have seen 171% increase in post-skip recoveries with offsets negating ~20% of paid losses every month.

The Impact: Stability in an Unstable Market

For our clients, this approach translates into:

Lower effective loss ratios.
More rate and deductible stability.
Clear, auditable processes from first notice of loss to final recovery.

The Breakdown (since 2020)

Skip Claim Volume: +49%
Skip Claim Severity: +32%
Positive Resolution Rate: ~70%
Post-Skip Recoveries: +171%
Paid-Loss Offsets: ~20% removed monthly

(Results vary by portfolio and market conditions; figures reflect Lee & Mason program outcomes.)

Claims Recovery Form

Let's talk about your portfolio

If claim counts and severities are rising or your locate/recovery performance is not where you need it to be, let's compare metrics. We'll show you how our skip tracing, vendor management, and remarketing can enhance your policy and program performance.

Contact us today to schedule a short claims process review. We would love to help!

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