Williams: Understanding the Decline in Collision Volumes: Consumer Economics and Insurance Trends
Collision repair volume is declining — but not because people stopped crashing. The real shift is behavioral. Today’s claim environment is shaped less by accident frequency and more by consumer economics, insurance pressures, and shifting perceptions of what is “worth filing.”
Insurance claims no longer reflect the true number of accidents. They reflect what consumers choose to report. And increasingly, consumers are choosing not to file.
Industry data shows:
- Initial police‑reported crashes for 2025 are flat to down 3% year‑over‑year.¹
- Repairable claims dropped 10.4% in 2025.²
- Fatalities and severe injuries declined 8.2%, driven by advanced safety technology.³
- Damage severity is shifting: lighter hits, more complexity, higher cost.⁴
The gap between accidents and claims is widening. 40%+ of the vehicles in parking lots or in automotive service lanes have some degree of damage. A rising number of these never enter the insurance system.
The economics are straightforward — and punishing.
- Auto insurance premiums have risen at historic rates, outpacing inflation.⁵
- A single claim can increase premiums 50% or more.⁶
- Those increased premiums can cost $3,600–$6,000 over 3–5 years.⁷
- Switching carriers does not eliminate the penalty due to shared underwriting databases.⁸
Some argue that consumers are bucking claim balance billing so why would they pay out of pocket to avoid a claim. The issue is with a claim, the balance billing on top of the increased premiums could become larger than the repair costs.
Informed consumers are doing the math. Many decide it’s cheaper to pay out‑of‑pocket or skip repairs entirely.
Shops traditionally lead with logic: certifications, equipment, training, OEM procedures. These matter — but consumers often don’t understand what they mean or how they affect outcomes.
Insurers, by contrast, communicate in simple emotional and financial terms:
- Savings
- Convenience
- Reassurance
When a collision center can appeal to emotional, logical, and financial components, they create a connection that enables a decision.
To address the trends, we must:
- Adjust messaging
- Diversify lead sources
- Engage consumers earlier
- Reduce claim‑related friction for the consumer.
- Build value propositions that resonate emotionally and financially
The shops that adapt will not only survive — they will lead.
Footnotes:
- NHTSA, Early Estimate of Motor Vehicle Traffic Fatalities 2025.
- CCC Intelligent Solutions, Crash Course 2025, Repairable Claims Index.
- NHTSA, Fatality Analysis Reporting System (FARS), 2025 preliminary data.
- Mitchell International, Industry Trends Report 2025, Severity & Complexity Section.
- Bureau of Labor Statistics, Consumer Price Index – Auto Insurance, 2024–2025.
- LexisNexis Risk Solutions, U.S. Auto Insurance Trends Report, Surcharge Impact Analysis.
- NAIC, Private Passenger Auto Insurance Premium Study, 2025.
- Verisk/ISO, Auto Underwriting & CLUE Database Overview, 2024.
About the Author
Ted Williams
Collision Industry Strategist and Consultant
Ted Williams is a collision-industry strategist and consultant with decades of experience working globally across OEMs, dealerships, MSOs, and independent repair centers. His work focuses on collision lifecycle ownership, customer retention, and sustainable growth models aligned with trust and repair quality.