Guest post by Clint Milnes, chief operating officer of the Winn Group
Milnes: No incentive for credit hire providers to inflate claims
Recent headlines about how the credit hire industry works speak volumes about how little is truly understood about this important element of the post-vehicle collision landscape.
But peel back the assumptions, and a very different picture emerges: one of a misunderstood system that supports tens of thousands of innocent drivers every year.
After a vehicle collision, credit hire exists to keep people mobile when they need it most. There are more than 33m insured vehicles on UK roads, with an accident rate around 9%. That’s millions of incidents annually where access to a temporary replacement vehicle can be the difference between mobility and disruption.
For many, losing access to their vehicle is more than just an inconvenience – it’s a major disruption to their lives which negatively impacts their work, the school run, and other important day-to-day responsibilities.
For the many people who can’t afford to pay upfront for a hire vehicle, credit hire is often the only viable solution. The House of Lords recognised this in Dimond v Lovell, 25 years ago, when Lord Nicholls described it as fulfilling a “real need” and Lord Hobhouse called it “understandably popular”.
Research shows that over 20m adults are financially under-served or show signs of financial fragility, and one in three have difficulty accessing credit from lenders.
In today’s context, the cost of living has continued to escalate significantly, with inflation affecting various sectors, including vehicle repair and hire. Moreover, the modern reliance on personal vehicles for commuting, especially in areas with limited public transport options, underscores the necessity of immediate access to replacement vehicles.
Given these challenges, ensuring accessible and fair credit hire services are more crucial than ever to support individuals in maintaining their mobility and managing the financial implications of unforeseen vehicle accidents.
These services are structured around risk, responsibility and accessibility. Accident management companies pay hire providers promptly and without conditions, providing credit to individuals while seeking cost recovery from insurers at fault.
Clients are explicitly informed about the identity of the providers, the fact it is not an insurance claim and the fact that vehicles are provided on credit terms.
Where payment isn’t recovered, losses are usually covered by insurance or other mechanisms to ensure a client is protected. These companies also often fund vehicle repairs and manage the entire claims process, bearing substantial overheads and commercial risks for months and sometimes for over a year.
The perception that credit hire is excessively expensive is often overstated. In reality, significantly higher charges tend to occur only in a small number of cases, typically where delays in repairing the damaged vehicle extend the hire period.
These delays are frequently due to a shortage of skilled repairers, particularly so for electric vehicles, or supply chain issues affecting the availability of spare parts. Crucially, these factors are beyond the control of both the accident management company and the driver.
There is no incentive for credit hire providers to inflate claims. They are only paid if the charges are justified and recovered. They face some of the most experienced and well-resourced insurer teams in the industry so inflated or unjustified claims simply don’t pay.
Charges are only recoverable if justified and proven. If a claimant is not impecunious, they are limited to recovering the basic hire rate, even if they signed up to a higher credit rate. Where impecuniosity is proven, the law recognises that the additional costs, credit provision, recovery risk and claim administration are legitimate and recoverable
Defendant law firm HF’s report, Claims Inflation in Motor Claims 2025, recently highlighted a 49% reduction in legal costs associated with credit hire since 2023, and a four-day drop in average hire duration.
This suggests improved efficiencies and signs of greater collaboration between accident management companies, insurers and defendant law firms, which we would like to see more of.
Credit hire can be the difference between standing still and moving forward after a vehicle collision. It’s time the narrative caught up with that reality.
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