Some insurers are moving car repairs in-house, but a repair association fears it's eroding customers' right to choose. Photo:
Insurers' moves to direct people to their own repairers is having a "devastating impact" on the wider panel beating industry, a representative says.
IAG, whose brands include AMI, NZI and State, has grown its own vehicle repair service - known as Repairhub or MotorHub - in the country's four biggest cities, after a successful trial in 2019.
AA has a deal with Drive Group, which provides repair services in Auckland and soon Christchurch, in a similar model.
Vero uses a network of general collision repairers.
Stewart Gibb, general manager at the Collision Repair Association, said customers' right to choose who to use for repairs was being eroded by insurers' moves to bring repairs in-house.
"The change has been implemented without any notice, and to be fair, who reads all their policy T&Cs when they renew insurance?
"The beneficiary of the change is insurer-owned repairers - MotorHub in the case of IAG, all vehicle insurance claims are directed to the insurer owned repair centres."
He said people who did not want to go to an insurer-aligned repairer were given a cash offer based on an insurance assessor's report, but that could be lower than a collision repair business would charge for the work.
Gibbs said the vertical integration of repairs into the insurance industry was a concern if it reduced competition and consumer options.
He said there had been a "devastating impact" on repairers in areas where MotorHub had been set up.
IAG has also now launched HomeHub, providing services such as carpentry.
Gibb said it seemed there would be more consolidation of the collision repair market.
"Because over time you'll have the larger, insurer-owned entities doing most of the business in the main centres and in the main volume areas and the smaller businesses will only be left out in the provinces where the bigger model of the insurers is not so viable."
But Dean MacGregor, executive general manager of supply chain and hub services at IAG, said customers had options.
"Customers have the choice of using our vehicle and home repair solutions via AMI MotorHub and AMI HomeHub, if this service is available in their area. Alternatively, they may choose to use an aligned repairer or their own repairer.
"Because getting our customers back on their feet quickly after they make a claim is of paramount importance, we are continuously enhancing our repair services offering through our aligned repairer network and Hub Services model. This includes expanding AMI MotorHub and AMI HomeHub to deliver customer experiences beyond insurance in new locations around the country where customers need us most, and where repair service demand is evident.
"We have strong relationships with our aligned repairers within New Zealand's home and vehicle repair network, with a focus on delivering exceptional service and high-quality repairs for our customers. Our aligned repairers are required to meet a strict set of criteria that ensure they deliver great service for our customers."
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