Latest / Best of Business / Kris Faafoi: Insurance Council CEO on the rise in people switching to third-party car insurance due to costs

Transcript

Kris Faafoi: Insurance Council CEO on the rise in people switching to third-party car insurance due to costs · Best of Business

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  Speaker 1: You're listening to a podcast from News Talk ZEDB. Follow
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• 0:16
  Speaker 2: Car insurance premiums have got so expensive that some people
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  Speaker 2: are looking at switching to third party only. According to
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  Speaker 2: data from insurance comparison website quashed Comprehensive car insurance quotes
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  Speaker 2: have gone up in price by forty one percent. That's
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  Speaker 2: in just two years. And while there hasn't yet been
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  Speaker 2: a mass switch to third party only policies yet, inquiries
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  Speaker 2: about third party insurance are up forty six percent, So
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  Speaker 2: we're thinking about it. Chris Partfoy is the Insurance Council
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  Speaker 2: Chief executive and joins you now, Hello, Chris.
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  Speaker 3: Good afternoon, Andrew.
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  Speaker 2: So why are the premiums going up so much?
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  Speaker 3: I love the number of factors. I think people are
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  Speaker 3: driving home this afternoon. I've the cars are driving around
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  Speaker 3: have been born in the last ten years, moving computers
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  Speaker 3: is a lot more electronics and modern cars and as
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  Speaker 3: res you know, they can be more expensive to fix.
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  Speaker 3: I think bumpers are one of the most expensive expensive things.
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  Speaker 3: Suffix with the likes of sensors and cameras that you
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  Speaker 3: have in back as backs of cars these days, and
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  Speaker 3: it does depend on the individual situation. You know, the
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  Speaker 3: cost of the car, who's driving it, where you're parking it,
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  Speaker 3: where you are that they are all factors. But you know,
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  Speaker 3: there's become more expensive to ensure them because the cars
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  Speaker 3: are you know, fixing them. Fixing them is more complex.
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  Speaker 2: If somebody brought in us because we always get that suspicion,
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  Speaker 2: you know, when you have to pay a fortune for
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  Speaker 2: a light bulb, you go, someone's clipping the ticket.
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  Speaker 3: I look up were acknowledge, you know, just a lot
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  Speaker 3: of just insurance that everyone's finding paying their bills more difficult.
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  Speaker 3: The stats that you quite said are interesting, but you know,
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  Speaker 3: the big picture steps indeed, last year said that vehicle
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  Speaker 3: insurance inflation is coming back from about klaster twenty percent
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  Speaker 3: twelve months ago at the end of last year to
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  Speaker 3: fifteen percent, so it's heading in the right direction. But
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  Speaker 3: you know, things are becoming more challenging in terms of
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  Speaker 3: fixing the vehicles. So I'm sure as they're doing things
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  Speaker 3: like trying to you know, bring costs down when they
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  Speaker 3: are repairing vehicles, but you know, extablishing hubs where they
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  Speaker 3: can affect these vehicles to try and bring down costs
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  Speaker 3: and trying to get cost stuff and supplies to you.
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  Speaker 3: So they all trying their best to keep the pressure down.
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  Speaker 2: That's it. The premiums keep going up. So people making
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  Speaker 2: the choice to drive around uninsured, I.
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  Speaker 3: Like, we hope they're not, because that's putting them in
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  Speaker 3: others at risk. We'll always say people should shop around
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  Speaker 3: and make sure that they've got the right insurance policy
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  Speaker 3: for them, whether the excess is right. But as most
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  Speaker 3: people would know, if you move away from comprehensive coverage
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  Speaker 3: to third party, you're not covered in terms of your
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  Speaker 3: own vehicle. The third party, the person that you might
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  Speaker 3: do some damage, is covered, but it obviously leaves you
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  Speaker 3: at risk of having to fund the money to replace
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  Speaker 3: a vehicle yourself. So we understand that people are finding
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  Speaker 3: things difficult, but first things first, they should probably go
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  Speaker 3: to the insurance company and find out what they can
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  Speaker 3: do to make sure that they can make it work
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  Speaker 3: for them.
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  Speaker 2: So the insurance companies are bargainable.
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  Speaker 3: Oh absolutely, I think you know when they are a members.
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  Speaker 3: But one thing the insurance Council would say is shop around.
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  Speaker 3: I've certainly seen examples of that myself, where people have
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  Speaker 3: shopped around and able to get a bit of deal.
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  Speaker 3: So you know, it's a pretty competitive market. You should
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  Speaker 3: be able to ring around competitors of your parentsurance insurer
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  Speaker 3: and I find out if someone can do a bit
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  Speaker 3: of deal.
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  Speaker 2: Okay, so more and more people are looking at their
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  Speaker 2: party insurance. I don't know if more and more people
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  Speaker 2: are taking it up. But here is a perennial talkback question.
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  Speaker 2: Should third party insurance actually be compulsory? Because until you've
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  Speaker 2: been run into by some dude who hasn't got insurance,
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  Speaker 2: you don't know how frustrating it can be.
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  Speaker 3: Well, okay, it is a perennial, but it's got some
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  Speaker 3: barbes here and there. If you do make it compulsory,
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  Speaker 3: there you know what prous does someone pay for whose
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  Speaker 3: low risk driver as opposed to a high risk driver?
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  Speaker 3: You know, if the government was looking to you know,
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  Speaker 3: capping that in low risk drivers would end up subsidizing
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  Speaker 3: highrisk drivers. We've got pretty good coverage in terms of
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  Speaker 3: comprehensive coverage vehicle coverage in New Zealand, so we understand
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  Speaker 3: and respect that, but you know they're ours and fishooks
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  Speaker 3: and going to a third party. You know, some other
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  Speaker 3: countries do have third party insurance that's compulsory, but they
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  Speaker 3: don't have the actually that we heat with body because
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  Speaker 3: that's our own body. And obviously if you have an
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  Speaker 3: accident here in His Zealand, you're covered by a SEC
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  Speaker 3: so we've got the the you know, the added advantage
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  Speaker 3: of having the atheency assistant therefore the bodily harm.
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  Speaker 2: Okay, good, Thank you, Chris Farafoy, who's from the Insurance Council.
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