COVID19 Vehicle Repair Delays & Loss of Use Insurance

Business & Commercial Insurances
Balance Advisors

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COVID19 Vehicle Repair Delays & Loss of Use Insurance

Despite it being well over a year since COVID19 sadly came into our world, it continues to have a substantial impact on our daily lives. In the insurance industry one of the major impacts we are seeing is the significant disruption to post claim repair times. Due to global supply chains issues, factory shutdowns and freight delays we are seeing severe delays with stock supply, in particular with auto parts supply.

We’re now seeing extensive delays for some repairs due to replacement parts being unavailable, longer lead times to get parts into the country and the resulting backlogs at repairers. This will potentially lead to more time off the road for some vehicle claims, and in some cases higher costs of repair.

What can we do to mitigate this risk?

Depending on your vehicle and where you are based, repairers will most likely have a courtesy vehicle available, but typically these are only supplied whilst your vehicle is in for repair. If the vehicle is off the road, not driveable and repair parts are weeks, if not months away…. then what?

Other than having a spare vehicle sitting in the garage ready to roll out as a replacement, the best way to deal with this issue is to look at adding insurance cover for a rental vehicle.

Options for commercial and private motor vehicles that can help at claims time

Commercial motor vehicle.

You might want to consider adding ‘Loss of use’ to your existing policy, which will provide for the costs to hire a replacement vehicle (if the loss is covered by the policy). Some commercial vehicle policies also include cover for expediting costs i.e. the cost of getting parts sent express if they are available.

Normally for road registered light vehicles this is limited to 90 days with a stand down or excess of 7 days from the time the vehicle is unable to be driven.

Some insurers have a bespoke loss of use cover for Mobile Plant and Equipment, which can be incredibly helpful when it comes to the loss of an item of equipment that has a significant impact on your business income.

Private motor vehicle.

Insurers can offer a ‘rental car’ policy benefit, which means insurers will contribute towards the hire cost of a rental car if the car is unable to be driven and the loss is covered by the policy.

Normally this benefit has a maximum period of 14 days, and the amount of cover will vary based on vehicle engine size.

Whilst insurers generally have a standard approach to loss of use and rental cover, it pays to look at your individual situation for a good solution. So if you would like to investigate further please contact the team at Balance to know more about these options.

0800 120 449

support@balanceadvisors.co.nz