Received this today - while I don't usually post op-ed pieces (press releases are ok), this is an interesting take so decided to post it here for discussion:
The increasing cost of replacing the modern technology embedded in new car windscreens will mean many consumers will no longer receive free vehicle glass cover under their insurance policy according to an industry expert.
Jo Mason CEO of NZbrokers, one of the country's largest insurance brokerage groups, says the change means owners of older vehicles will lose their free glass cover - even though the impact on insurers is due to the cost of repairing technology is only found in the newest models.
“Some new vehicle windscreens can contain a wide range of sophisticated technology including cameras, radar, rain sensors, heating elements, light sensors, UV protective cover and even acoustic lamination - which can be expensive to replace.
“We have seen one example of an insurance claim for a new car replacement windscreen a costing upwards of $15,000.
“While we have seen extreme cases where windscreen repair claims can reach this level, it is rare as they are typically in the very latest models and vehicles retailing at more than $100,000.
“Putting this in perspective, the average age of the four million vehicles in New Zealand’s fleet is over 14 years - and you can pick up a standard windscreen for an older model for under $200,” she says.
Mason says that insurers are now seeing the likelihood of higher cost across their portfolio and are moving to change their policy conditions.
“Free glass cover has been a standard feature of most vehicle insurance policies in New Zealand for decades.
“Although some of this technology is just coming on to the market now, we’ve already had one insurer say they will no longer provide free glass cover as a result of the higher cost of replacing windscreens,”
“Our concern with this change is that for the vast majority of vehicles on the road, the cost to replace their windscreen is just a few hundred dollars, but the policy change should not penalise the owners of older vehicles who do not have the latest technology.
“Unfortunately the change by one insurer will mean that for all motorists regardless of the age of their vehicle, they are likely to lose the benefit of a replacement windscreen with no excess at some stage in the future, if not already,”
“Left unchecked, we believe this trend could become commonplace among all insurers which would be inherently unfair to most Kiwis and could be better managed by premium or excess increases for just those cars with modern technology,” she says.
Mason says the change is likely to impact many motorists when they go to renew their vehicle insurance and they should check with their insurance broker to ensure they are adequately covered in the event of vehicle glass replacement.
“While we haven't seen this change implemented across all insurers yet, we believe it is inevitable that a maximum limit will be placed on the amount of windscreen cover unless consumer response to the potential change sees them look for alternative solutions.
“Consumers need to make sure they speak to their broker and read the policy fine print when they next renew their insurance and consider shopping around for the best coverage package that suits them,” she says.