Parliamentary secretary for Hawkesbury, Ray Williams made a speech in Parliament on 12 March 2013 on the subject of 'industry concerns' over choice of repairer and specifically about Suncorp and the Capital S.M.A.R.T network, as well as AAMI repairer standards.
In the speech, the full transcript of which can be found below, Williams relays issues raised at an MTA NSW meeting he attended in Auburn. Williams says 'he has been informed' of Suncorp making it difficult for customers to have their cars repaired using choice of repairer, of the insurance company making customers drive unsafe cars to obtain quotes when those cars should be towed, disregard of the Code of Conduct, as well as high rectification rates from the AAMI network. He said that Suncorp owning its own repair network 'set a very 'dangerous precedent' and that he had written to the Minister for Fair Trading on this subject. He then went on to imply that Suncorp is less likely to properly inspect the work from its own repair network and is more likely to cut corners.
Paint and Panel asked Suncorp for its views on the speech and a spokesperson said: “The Member for Hawkesbury is obviously a keen advocate for the motor industry and we share his commitment to the safety of consumers.
“Unfortunately we are disappointed the Member for Hawkesbury’s concerns were not raised with us at any point, as his statement is built on several factual errors about the Code, about how we operate, and about our joint ventures with innovative repairers.
“The Code - of which we are a proud and supportive signatory and a member of its committee - does not require choice of repairer in all motor policies. We recognise choice is important to some customers and offer it in five of our brands.
“Q-Plus is not yet operating, so no customer cars are being sent there. A Capital SMART Repair facility received three technical breaches because otherwise qualified tradesmen – from Perth, Brisbane and Ireland – had not yet gained their NSW license. This situation has been fixed and they are not alone in the industry on this issue.
“The claim that we are knowingly putting customers at risk by “forcing” them to drive unsafe cars if they exercise choice in their policy is outrageous, baseless and absolutely contrary to the way we operate.
“In terms of delays for customers who exercise choice instead of asking us to handle their repair, including SMART – this is inaccurate. Delays occur for many reasons for all repair methods, including SMART. We do not discriminate against customers who exercise choice.
“Of particular concern is the inference that a repairable write-off that was crash tested was somehow related to one of our aligned repairers as part of a claim. At no time has this been raised by the RMS/RTA or anyone else including those involved in the test – which appears to have been undertaken years ago.
“No one denies the industry is changing and there are many challenges on the horizon. Ignoring the reality of this and instead repeating misinformation about the practices of one work provider won’t address these challenges in any way.”
Transcript of speech Ray Williams (Hawkesbury-Parliamentary Secretary) [1.16 p.m.] 12 March 2013
Today I advise the House of an important issue raised by various business people in the Hawkesbury area who are involved in the motor vehicle repair industry. As I have advised the House previously, I have a background and qualifications in the vehicle repair industry, particularly in the heavy vehicle repair industry. I remain a staunch advocate of the industry, especially in relation to the various Acts that deal with improvements to the safety of motor vehicles that are repaired and returned to our roads.
Last week many small independent motor vehicle repair businesses located across the Sydney metropolitan area met with the Motor Traders Association of NSW at Auburn to discuss these matters. The member for Bankstown and I attended that meeting to listen to the concerns of the industry. I was particularly concerned to learn of a dangerous anomaly in insurance practices in relation to the repair of damaged motor vehicles. Currently many insurance policies offer the choice for individuals to choose their own motor vehicle repairer following an accident. Indeed, it is a section under the code of conduct that specifically deals with the rights of an individual to choose their preferred repairer. However, this policy section appears to have been disregarded by certain insurance companies.
I have been advised that if a customer seeks to have their vehicle assessed at one of the various insurance arms of Suncorp Insurance that customer is informed that if he or she wishes to choose their own vehicle repairer they will have to seek their own quotes and then wait for up to three weeks or more to have their vehicles repaired. It should be noted that 30 insurance companies are now owned by Suncorp Bank, including AAMI Insurance, Australian Alliance Insurance, Australian Pensioners Insurance, Apia, Bingle, Comprehensive Travel Insurance, GIO Insurance, Guardian Trust, L. J. Hooker Insurance, New Zealand Commercial Insurance, RACT Insurance, Shannons Car Insurance, Suncorp Insurance, Suncorp-Metway and Vero. Turning customers away when they are driving a damaged vehicle is a direct contravention of section 4.2 of the Motor Vehicle Insurance and Repair Industry Code of Conduct, which is mandated by the New South Wales Fair Trading Act. It states:
4.2 Insurers
In their dealings with Repairers in relation to repair work, Insurers will:
...
(f) not knowingly ask claimants to drive unsafe motor vehicles for the purposes of obtaining alternative estimates.
I advise the House that this action by an insurance company is nothing more than a ploy to encourage an individual to have their car repaired at the insurance company's preferred smash repairer.
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This action places the driver of a defective vehicle and every other driver on the road at risk of serious injury if a crash were to occur while a person is driving a vehicle known to be damaged. To add weight to my previous comment, customers of these insurance companies are also advised that if they send their vehicles to either Capital S.M.A.R.T Repairs or Q Plus repairs to the vehicle will commence immediately.
Upon closer inspection of this matter, I have discovered that Suncorp Insurance, which is owned by Suncorp Bank, now also owns a large number of its own motor vehicle repair outlets known, coincidentally, as Capital Smart Repair and Q Plus. This appears to be a major conflict of interest because the insurance company now owns the actual motor vehicle repair businesses. I have taken the liberty of writing to the Minister for Fair Trading and advising him of what I believe is a very dangerous precedent. It also brings into question whether the appropriate inspections are being undertaken following the completion of the repairs to the vehicles, as it appears vehicles are being repaired to a price rather than a standard.
I have also been informed by the Motor Traders Association of New South Wales that infringement notices have been issued by NSW Fair Trading to one such Capital S.M.A.R.T Repairs shop-owned by Suncorp Insurance-due to unlicensed employees carrying out smash repair work. As I previously stated, I am qualified to work in this industry and can inform the House that qualification can only be obtained after years of undertaking an appropriate apprenticeship and then obtaining a trade certificate in the motor vehicle repair industry. Without this qualification it is illegal to undertake any work on any motor vehicle. I hereby table my trade certificate qualifications for the benefit of the House.
I have also been advised that one of the subsidiaries of Suncorp, namely, AAMI, has an extremely high rate of rectification work. Rectification work is work that is required following the repair to a vehicle because the vehicle is still not in a roadworthy condition-for example, because of the failure to remove and replace damaged chassis rails, which, if the vehicle were to be involved in another accident following an inappropriate repair, could result in fatalities of the driver and passengers, given that the structure of the vehicle has been completely compromised. Evidence to support this statement has been obtained by the Roads and Maritime Services-formerly the Roads and Traffic Authority-Crashlab in Huntingwood, where the Motor Traders Association of New South Wales took a reregistered repairable write-off to be subjected to an applicable Australasian New Car Assessment Program test. The results of the test showed that an accident would have resulted in both of the front seat occupants suffering fatal injuries due to the poor repairs to the chassis rail.
The motor vehicle repair industry is seeking the support of the New South Wales Government to ensure that customers who are insured and are seeking to have their vehicles repaired have the choice of their own vehicle repairer and that their safety is not placed in jeopardy when they are turned away by insurance companies and advised to obtain their own quotes for repair. The safety of not only the driver is placed at great risk by driving a defective vehicle but also members of the general public who could become the innocent victims of a dangerous accident caused by a vehicle that should not be on the road. As I have stated, I have raised this matter with the Minister for Fair Trading and he has advised me that he is currently investigating these issues through the Motor Vehicle Industry Advisory Council. I will be happy to provide any information and support available to the council in order to rectify these problems on behalf of the motor vehicle repair industry. This is an extremely important matter and I will be more than happy to support amending or enforcing any legislation that is required to ensure the people of New South Wales are protected from these dangerous insurance practices and that the safety of the public is not placed at risk.
Parliamentary secretary for Hawkesbury, Ray Williams
