3 minute read
New Disclosure Requirements for Vehicle Repairs
by Boylen
On 1 June 2023, new laws spearheaded by the MTA commenced to help consumers be better informed about relationships between motor vehicle insurers and repairers.
Under amendments to the Fair Trading Act 1987, motor vehicle insurers must now tell policy holders about any relevant interest they have in a repairer and whether policy holders have a choice of repairer.
Below, the Commissioner for Consumer Affairs, Dini Soulio, answers some key questions about what the changes mean for industry and consumers.
What will motor vehicle insurers need to do?
Motor vehicle insurers need to tell policy holders about any relevant interest the insurer has in relation to a particular repairer, such as if they have a financial interest or a contract with the repairer. Ad-hoc or one-off arrangements do not need to be disclosed.
Disclosure must occur before an insurer engages or authorises a particular repairer to undertake repairs under an insurance policy.
How do they need to disclose this information?
Insurers must publish a list of repairers they have an interest in (a statement of relevant interest) on their websites.
They should also provide these statements directly to policy holders, and let them know they are available on their website.
What else do insurers need to let policy holders know?
Insurers now need to let policy holders know whether or not they have a choice of repairer.
They must do this whenever a person enters into an insurance contract, renews a policy or makes a claim.
Why have these changes been introduced?
The changes are about increasing the transparency of relationships between insurers and repairers. By enhancing consumer awareness regarding choice of repairer, informed decisions can be made. Often, this information is only included in Product Disclosure Statements and may be missed by consumers.
This will benefit consumers and support transparent, informed, effective and cooperative relationships between motor vehicle insurers and repairers.
What is the role of Consumer and Business Services (CBS) in this change?
CBS is responsible for administering the Fair Trading Act and we will be monitoring the industry to make sure they are complying with the requirements and acting if insurers are not doing what is required. A six month grace period will apply until 1 December 2023 to allow the industry to become fully compliant with the new provisions.
Other changes have been made to the motor vehicle insurance and repair industry, including the introduction of a Code of Conduct for motor vehicle insurers and repairers. The Code of Conduct is administered by the South Australian Small Business Commissioner (SASBC). For more information visit the SASBC website.
