Insurance changes irk repairer
A local panelbeater has com- plained he is still out of pocket despite New Zealand’s dominant insurance company increasing its payment rates.
Last year smash repairers told Kapi-Mana News they were being squeezed out of business by low insurance payment rates, driven by the dominant company IAG, which includes State, NZI, AMI and Lumley.
This year about 100 crash repairers complained to the Commerce Commission about IAG’s practices.
In July, IAG reviewed its rates and standards, categorising repairers into three standards with tiered payment rates, which, it said, improved minimum quality and safety standards.
A Commerce Commission spokesman said the commission had received several complaints about the company earlier this year and had completed its assessment of those complaints.
‘‘We believe the practices of the insurance company are not likely to breach the Commerce Act, and will be taking no further action,’’ he said.
A local repairer spoke on condition of anonymity last week.
He said IAG had increased its hourly pay rates, but reduced the time allowed for tasks, leaving overall payments lower.
It had also implemented a review of repair shop standards, grading repair shops into basic, intermediate or gold standard, and paying them differing rates.
Most shops were downgraded to lower rates.
Gold-standard shops are paid $82 per hour, but the number of them in Wellington was reduced after the review from about 15 to four.
Intermediate shops are paid $68 per hour, up from $45, but the allowances for work were reduced.
Previously the company allowed 0.5 hours’ labour at $45 per hour to fit and refocus a headlamp, or $22.50. The new rate is 0.25 hours at $68, or $17.
The old rate for fitting a front bumper was 1.5 hours at $45 or $67.50. The new rate is 0.75 hours at $68, or $51.
The time allowances for panel repair work and for painting did not change.
‘‘There was a groundswell of sympathy for repairers,’’ the business owner said.
‘‘This is to quell those issues. They wanted to look as if they were doing something proactive about it.
‘‘It’s great that they are getting the repairers to pick up their standards, but it’s still in their favour.’’
been required to sign a non-disclosure agreement, he said.
Assessors were also phoning to ask whether he had a courtesy car available for clients. If the answer was ‘‘no’’, the repairer might not get the work.
If it was ‘‘yes’’, the repairer was not paid any extra for that service.
Some policies specify a courtesy car for clients.
IAG claims service general manager Ruth Colenso said the company had undertaken a comprehensive review of repairers and introduced tiered rates based upon criteria that reflected their investment in training, equipment and customer experience.
The changes contributed to better outcomes for customers by promoting higher repair standards, and provided repairers with clearer expectations for the business they receive through the IAG network, Colenso said.
The new repairer times and allowances were more accurate and were developed with IAG’s repair method data and times derived from its Research Centre in Sydney, as well as feedback from New Zealand repairers.
Despite the tighter allowances, IAG was actually spending an additional $8 million per year, focused on its approved repairer network.
‘‘The IAG Approved Repairer agreement does not include nondisclosure about repair standard measures,’’ she said.
Insurance claim: A damaged headlight, which a crash repairer will receive $17 for replacing, down from $22.