Pricing the Wreckage

Sun (Auckland), Volume II, Issue 521, 26 November 1928, Page 8

Pricing the Wreckage

FIVE MOTORS CRASH DAILY

APPROXIMATELY live motor-car accidents involving damage of £lO and over occur in Auckland Province cverv dav. This estimate is prepared as an average by an adjuster "of insurance values upon -wrecked vehicles who, incidentally, reveals the fallacy of owners over-instiling their ears in the belief that they will collect the full cover irrespective of the current market value.

fJMIE abnormally large number of motor-car fires in Auckland was dealt witb in The Sun last week, when it was mentioned incidentally that the fire ratio was the highest in the world. Among cars damaged by impact, also, Auckland ranks among the highest, and the claims upon insurance companies are increasing annually. It is a significant fact, and a tribute to the efficiency of the city traffic control, that street intersection accidents of a serious character are exceedingly rare. When damage is done at street

corners the fault usually lies in an error of judgment on the part of a driver or in the disobedience of the gesture of the white-gloved hand. "The control of traffic in Auckland compares favourably with anything in the world,” one motoring man said, in paying a compliment to the work of the city traffic department, "and the motoring public of the city has a great deal for which to thank Mr. G. Hogan and his men.” The great majority of motor-cars are insured. If they are purchased on the instalment plan or under time-pay-ment conditions, insurance for the benefit of the vendor is compulsory; if they are paid for in cash the buyer usually can afford a substantial indemnity cover against damage or destruction.

The rpost remarkable thing, however, and the most fallacious, is the almost universal desire of the owner

to over-insure. Those who are ignorant of the provisions governing their policies offset one insurance company against another in bargaining for terms, and finally accept the proposition of the concern which gives the largest cover. They believe that in the event of their cars being destroyed nothing can prevent them receiving full insurance money. But the insurance adjuster invariably enters the arena of negotiation when the indemnity is above market value, and payment is made accordingly. In the main it is useless endeavouring to impress a car owner with the fallacy of ovgr-insurance, and the result is that over_Bo per cent, of the vehicles on the road are covered above their true worth. LITIGATION TOO COSTLY The effect of depreciation, which is worked by standard tables based upon years of actual experience, is a potent factor in falling values. As soon as the number plate is attached to a car —even though the wheels might not have turned—l 24 per cent, comes off its value. The car is then secondhand. because it is registered in somebody's name. The same vehicle depreciates 33 1-3 per cent, in the first year. Thus a £450 car will fall in value to £3OO in 12 months, and the owner will be paid in proportion to its commercial usefulness. The adjuster, upon whose judgment a case usually depends, and who incidentally cannot afford to err, is permitted to recommend that in lieu of insurance money, the wrecked car shall be replaced by a similar model iu first-class condition. About 40 per cent, of accidents to motor-cars are made the subjects of negotiation between the owner, the insurance company and the adjuster. Frequently it is more profitable for the company to compromise upon values than to fight a case in (fie courts, as the handling of a claim for insurance in this category costs from £l5O to £3OO. HOW DO THEY ESCAPE? As an illustration of the unplumbed possibilities of motor-car accidents, a student of Auckland's traffic problems declares that too little attention is paid by the authorities to the rapidity of mental reaction in a crisis, and to the ratio of accident danger in cars travelling at specified speeds. The average mental reaction is 1 1-5 seconds; the world’s slowest is 2 1-5 seconds. A car travelling at five miles an hour covers 7.3 feet in a second. Work that out and calculate whaj chance of escape there would he for two cars approaching a corner; at 50 miles an hour. A vehicle of the weight of an average car, doing 20 miles an hour, will skid 37 feet 6 Inches with the wheels locked; goiug at 30 mile 3 an hour it will skid S 4 feet; covering 50 miles to the hour the skid with wheels locked will be 232 feet. With four wheel brakes the skid is reduced by onethird.