Comment sought on compulsory third party vehicle insurance

New Zealanders are being urged to have their say on the introduction of compulsory third party vehicle insurance for all motorists.

Transport Safety Minister Harry Duynhoven has today released a discussion document seeking information on vehicle insurance in New Zealand. The intention is to gauge public opinion on seeking a compulsory third party scheme. This would require all motor vehicles to be covered with at least third party insurance. Many motorists choose to do so already, as it is a low cost protection.

“About a quarter of vehicles in New Zealand are not insured. The insurance industry estimates the cost of uninsured motorists is between $53 million and $85 million each year. At present, those who have vehicle insurance are paying for the costs of all motorists through their insurance premiums,” said Mr Duynhoven.

Unlike in other countries where compulsory schemes exist, the New Zealand system would only cover property damage, as ACC already provides cover for personal injury sustained in a motor vehicle crash. Motorists will still be able to choose to have comprehensive insurance to cover damage caused to their own vehicle and property in a crash.

“A compulsory third party regime would address issues of equity and road safety. At-fault insured motorists would be protected against potentially hefty costs in the event of a crash and responsible drivers wouldn’t be left out of pocket.

“Compulsory third party insurance would also be a major incentive in getting people to take greater responsibility for their driving behaviour, especially younger drivers.

“I know there is considerable public interest in this issue and this discussion document is an opportunity for people to have their say. Public feedback will help fill information gaps on vehicle insurance in New Zealand and encourage discussion on the design, enforcement and compliance costs of a compulsory third party vehicle insurance scheme,” said Mr Duynhoven.

The discussion document on compulsory third party vehicle insurance along with the submission form, are available at www.transport.govt.nz. Submissions close on Friday 8 August 2008.