Motor insurers and credit hire companies agree increased hire rates

Motor insurers and credit hire companies have signed an interim agreement on increasing certain hire rates to reduce the impacts of “bottlenecks in the supply chain” that “weren’t reflected” in the General Terms Agreement (GTA), according to Credit Hire Organisation (CHO) chairman and chief executive Anthony Hughes.

The interim agreement – which is for subscribers to the GTA – will apply until 30 June next year at the latest, by which the CHO hopes that a more comprehensive set of rates will be finalised following the completion of rates research by external consultants.

Hughes said pressures on the suply chain included “access to vehicles, a tightening in the supply of new vehicles and across the board hikes in hire rates”.

The table of agreed interim rates has placed recommended rates at 7.5% for standard vehicles, as well as for multi-purpose vehicles (MPVs), 4x4s, prestige and commercial vehicles. 

Motorbikes have been set at 5%.

Mobility access

Hughes said: “A compromise will never tick the boxes for all our members and I know that this has been a tough process, but we feel this interim deal will at least ease some of the pressure on our members and reduce the risk that customers would struggle to access the mobility they need.”

Steve Hiscock, who leads the motor insurers group on the GTA, added: “I’m pleased we’ve been able to come to an agreement for the benefit of our customers. It underlines the value of the GTA as a means of achieving a consensus approach to these significant challenges through cooperation and compromise.

“It is important that we build on this temporary arrangement during the next few months to put in place a GTA that is able to meet the challenges posed by the rapidly changing environment in our sector.”

As part of the announcement, it was revealed that credit hire companies and motor insurers have also been meeting to explore how the GTA can be revised to become fit for purpose over the remainder of the 2020s.