media release

7 September 2016

ICNZ welcomes new rules on water damaged cars

The Insurance Council of New Zealand welcomed the announcement today from NZTA that water damaged light vehicles will now need electrical and pyrotechnic safety components replaced.

Tim Grafton Insurance Council Chief Executive says “insurers welcome this change as the importation of water damaged vehicles increases the risk of serious accidents, particularly due to failures in advanced vehicle safety systems.”

With advanced vehicle systems, such as collision avoidance, becoming common place on newer vehicles, an electrical failure can risk a serious accident involving multiple parties.

Background

It is common for damaged vehicles to be imported into New Zealand from Australia. These vehicles are write-offs in Australia and cannot be driven on their roads, but are purchased and exported to New Zealand. On arrival in New Zealand these vehicles may be declared as flood damaged or they may not. If not, there will be no obvious signs to alert border security officials who would refer a vehicle for a compliance check. If they are flagged, then those that certify the vehicles road worthiness will be unable to detect latent damage to advanced vehicle systems which may manifest as safety issues over the next year or so.

A number of repairers have come across vehicles that had been flood damaged prior to importation, then sold and later required normal in-service collision damage repairs.

A number of these vehicles had obvious signs of previous water damage to safety restraint systems and electrical components that only became apparent when the vehicle was dismantled for repairs. Water damage is a concern for the longer term operation of the safety components and electrical systems. Once connectors on wiring harness and circuit board components become wet they are at significant risk of ongoing corrosion and electrical connections failure. Although the components may initially operate following flood damage repair, over time they are likely to degrade and fail.

ENDS

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