Toyota Insurance Services (TIS) has opened a new operating centre in Shrewsbury. It is a bet on the dealer-sold add-on products that the regulator pushed close to breaking point only two years ago.
The site, called the Affinity Hub, will employ around 50 people. They will handle administration and claims for the extra products Toyota and Lexus customers buy with their cars: total loss asset protection, minor damage cover, excess protection, and tyre and alloy protection. The building also has hot desks and meeting rooms for Toyota and Lexus staff on the road.
The opening completes a three-region network. TIS already has bases in Newcastle upon Tyne in the north and in London and Epsom in the south. Chief executive Jason Milton said the business wanted a central site to complete the set, and Shrewsbury fitted the bill. He tied the move to the growth ambitions of both brands and to supporting dealers and drivers across the country.
The building has had a technology refit to support what the company calls ambitious growth plans. TIS has not said how many more people it expects to hire.
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TIS was set up in 1999 and is part of Japan's MS&AD Insurance Group, according to Toyota's UK insurance pages. It says it runs its motor programme from underwriting to claims, and that repairs are carried out by Toyota-trained technicians using genuine parts.
Shrewsbury fits a pattern of bringing work under the group's own roof. TIS previously moved its UK telephone sales and service operation to sister company Aioi Nissay Dowa Europe's North Tyneside centre, creating more than 150 jobs.
Total loss asset protection is Toyota's version of GAP insurance. It pays the difference between what a motor insurer pays out on a written-off or stolen car and what the driver paid for it or still owes. Few products have had a rougher few years.
Value measures data for 2022 showed that only 6% of GAP premiums went back to customers as claims. The Financial Conduct Authority also found some firms paying up to 70% of premiums in commission to intermediaries such as car dealers. In February 2024, insurers covering around 80% of the market agreed to stop selling until they could show fair value. The regulator later put the expected saving to customers at around £70m.
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Firms that cut commission and redesigned their products were allowed back in. The numbers have since moved sharply. The FCA's 2024 value measures data shows GAP claims costs above 100% of premium, up from 10% for add-on GAP in 2023. The regulator puts that down to its intervention. Analysts have noted that the figure is flattered by a collapse in premium volumes during the sales pause, so it is too early to declare the product fixed.
Other add-ons still look patchy. In the same 2024 data, motor insurance paid out around 54% of premiums, while personal accident add-ons paid out just 23%.
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There is also a market argument for expanding. Car values have fallen back from their post-pandemic highs, and theft remains a problem, so the gap these products cover is getting wider. Recent figures from one provider showed GAP claim values rising sharply, with premium SUVs prominent among the largest payouts.
For a manufacturer-owned insurer, keeping claims and administration for these products in-house also helps it show the product oversight and claims standards the FCA expects under the Consumer Duty. TIS's announcement did not mention regulation, but the timing will not be lost on rivals selling through the dealer channel.
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The refit also left TIS with a stack of old laptops. It gave them to Shrewsbury Town Football Club Foundation instead of scrapping them. The club's charity runs education, wellbeing and community programmes across Shropshire, and the laptops will support its Employability Youth Hub, which helps young people into training and work.
Milton said the donation reflected Toyota's "commitment to sustainability, which is a core priority for our business."
Shrewsbury Town defender Will Boyle and England and Lancashire fast bowler Saqib Mahmood attended the opening.
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