Car Insurance Premium According To Category

Press, Volume CVI, Issue 31224, 23 November 1966, Page 10

Car Insurance Premium According To Category

Correspondent N.Z.P A.)

SYDNEY, November 22. Thousands of Australian car-owners were shocked to read this week that the make of vehicle they had bought is considered a bad accident risk, and that their insurance premiums may rise steeply under a revolutionary new scheme. The new scheme, already in use in Western Australia and expected to be adopted «■* insurance companies in other States soon, puts various makes of cars into three categories, each with a different premium rate.

The scheme has already produced strong protests from manufacturers whose vehicles appear in the dearest category, and from car owners. It was devised by the Royal Automobile Club of Western Australia after 40,000 accidents over three years had been analysed and their details fed into a computer.

The three categories of vehicles under the Western Australian scheme are:

Schedule one (the cheapest premium rates): Holden, Ford Falcoln and Zephyr, B.M.C. cars, including the 850 and 1100, Rootes Group cars and all Japanese-made cars. Schedule two (dearer): Ford Anglia, Prefect, Consul and Cortina, Simca, Vauxhall, and most big American cars. Schedule three (dearest): Fiat, Jaguar, Mercedes, Rambler, Volkswagen, Chrysler Valiant, Triumph Herald, all French-made cars and all sports cars. The schedules take into account cost of spare parts, difficulty of repair and the accident record of each make. Mr E. Menmuir, general manager of R.A.C. Insurance Proprietary, Ltd., Perth, said: “You can theorise until you’re black in the face as to why certain cars are certain schedules. The hard, root fact is that’s where the computerised statistics prove they belong.” “Iniquitous” A spokesman for Chrysler Australia, Ltd., has said it was “iniquitous” that the Valiant should be placed in a dearer schedule than its main rivals, the Holden and Falcon. A Volkswagen spokesman said the schedules had been based on obsolete records. “Many years ago we had a lot of rally successes which encouraged many young drivers with long hair and heavy feet to buy our cars,” he said. “As a consequence, we did have more accidents. But now we have much more mature people buying the car. The insurance people have not brought their research up to date.” Other features of the new scheme are that all excesses, except those on drivers under 24, those on sports cars and on cars being bought on hire

purchase, have been discarded. -No-claim bonuses have been increased. Under the new scheme there is a $5O (£2O N.Z.) excess on all drivers aged 24 and under, a $2O (£8 N.Z.) excess on hire purchase vehicles, and a $lOO (£4O N.Z.) excess on sports cars. Critics of the scheme say careful drivers still appear to be subsidising the careless — a point that most Australian insurance companies have been looking at very closely for the last two years. The companies are very conscious of the unfairness of the present system and have been trying to work out a scheme that is just to the careful, accident-free driver, but penalises the bad driver. Most motorists are wary of the new plan, fearing that once again it will mean increased premiums. Already the driver, of say a 1965 Volkswagen, pays around $l3O (£52 N.Z.) a year for insurance and registration.