Andrew Tobias makes the claim inone of his books, that new Zealnad has a unique system for auto insurance. basically, you pay for it when you buy gasoline-a tax is assessed by the government, which goes into a national fund, which pays the claims. On the surface-this sounds ideal: it eliminates the free riders (i.e. those who drive and pay no insurance premiums0, and covers everybody. Well, is this really how autos are insured in NZ? and, is it a good system?
I’m not familiar with the author or the book, but he is partly right.
The personal injury part of an accident is covered by part of the annual car registration fee and by a tax of 5.78 cents (NZD) per litre. ACC news Current fuel price for 91RON is NZD1.38
Personal injury is covered by a no fault insurance funded by employers and levies on certain things, such as fuel, actually maybe only fuel.
We cannot sue for personal injury. If we are injuried most of the care is free. Hospital care is fully funded in injury cases as far as I know, I’ve never had to try it out. I’m currently getting Physio and pay a part fee of $20 per visit.
Vehicle accident (damage and 3rd party property damage) insurance however is optional which of course the owner has to pay for.
Dave
Thanks sounds like an excellent system. here 9in the weird world of Massachusetts), our auto insurance is controlled by the state-which means (of course) that we have the costliest, least efficient system possible. Briefly, you must buy insurance (from the handful of firms licensed by the state. the state sets the rates, policy , etc. However, you have to buy three kinds of insurance;
-(compulsory) covering injury to yourself and other parties
-collision (optional actually0 to cover damage to your vehicle
-uninsured motorists (to protect yourself, should you be hit by someone driving without insurance (actually optional
The system is beset by farud and criminal intent. plus, you can file a damge lawsuit, once your injuries pass $2000.00 So we get a lawyer-dominated system, which is corrupt and expensive, and offers uncertain payouts. i like the idea that people CANNOT escape paying into the system ( with your gas tax).
Car insurance here, though, is different from accident/personal injury insurance (which, as dynamitedave said, is covered by our accident compensation regulations). There’s still a lot of vehicles around which are either under-insured or not insured at all. Again, as he said – that’s still optional.
And if I fully read my link :smack:
Averages in link
As Ice Wolf said, any insurance for physical vehicle or property damage is under the free market system (and not legally required), only the personal injury insurance is run by an agent (ACC) of the government and ends up being compulsory by its method of collection.
Whether we get a good deal, I don’t know. I paid NZD414 inc. tax over 12 months for the fuel levy and registration (I used 2784 litres fuel at 5.78 cents/litre plus $206.93 (these plus tax @12.5%)) This is just for injury to myself and other parties due to vehicle accident. I then paid another $2080 to ACC to cover any other form of injury, both work and non-work related. To provide full cover over my ute, which is insured as a work vehicle and has a value of NZD6000 cost me NZD388 last time I paid.
I’m not sure of the current financial status of the ACC but I know several actuaries in NZ who did some work for the ACC a few years ago, analysing the size of what was then a significant unfunded liability.
I wonder if that is the reason for the pre 1999 claims levy? All I know is that it’s to fund on-going care for injuries sustained prior to 1999. The levy will decrease over time but I guess it’ll be around for a fair while. Also the system has changed several times to/from “fully funded” and “pay as you go” depending on the government’s whim :rolleyes: It looks like it went back to “fully funded” in 1998, so that would mean a levy would be needed for pre 1999 claims. I guess someone would of had to figure out the missing millions! :eek: ACC history
Cool link, dynamitedave. We don’t have a bad system, really, for all its foibles. It probably could have done without the private enterprise thing in the 1990s, though – but that’s another story.