The new directive weakens the independence of the garages, and also turns private garages into a type of arrangement garages (photo: manufacturer's website)
At the end of September, S's Mazda was involved in a car accident.
No one was hurt, but the vehicle was towed to the garage, and the appraiser who inspected it approved a repair of NIS 40,679.
But at the end of the repair, the insurance company Direct Insurance informed her that it would only pay her NIS 19,460.
The insurance company had no reservations about the appraiser's report, the quality of the repair, and the reliability of S's report on the accident.
An increased deductible amounting to NIS 1,720, because of her choice to repair the vehicle at a garage other than the company's Seder garage, was offset from the amount, and mainly NIS 19,195, for the differences in the cost of the parts.
"In accordance with the provisions of section 4 of the provisions of the supervision of insurance businesses (conditions of a contract for private car insurance), 5756 1986 and chapter 1, section 4 of the policy conditions," the company explained, "you were informed, at the time of opening the claim at our company, that our company is the one that will supply the garage You have the necessary parts to repair your car.
Since you acted contrary to this directive, in violation of your obligation to minimize the damage, and contrary to your obligation according to Sections 56 and 61)a) of the Insurance Contract Law, 5571-1981, we deducted from your demand the excess cost claimed for spare parts and approved only the cost that our company could have provide them to you."
And in Hebrew: the insurance companies have a new exercise for the insured.
If until today we could choose between a repair at the Seder garage over which the company has a greater influence, in exchange for paying a reduced deductible.
Now they also demand that even if the insured prefers to have his vehicle repaired at a garage he knows and trusts professionally, they are the ones to provide him with the parts, or to deduct from the amount of compensation to the insured the difference between the amount they were required to pay for the parts, and the amount they claim they would have paid for them if they had purchased them themselves.
This is a condition that Direct Insurance was the first to set for the insured, but since then it has been joined by Menora and Phoenix, which claims that it is a limited pilot for the time being.
It should be noted that the companies did not explicitly present the change to the insured when they purchased the policy.
According to them, they operate in accordance with the regulations of the insurance commissioner, which require the insured to do everything to reduce the damage.
Car repair in the garage.
The big discounts for insurance companies and garages are distorting the parts market (Photo: Nir Ben Tovim, PR)
Sources in the insurance industry claim that the companies are able to purchase the parts at a cheaper price than what the garages demand for them, and that in light of the increase in the prices of the parts and the car thefts that have shifted the field of car insurance to losses, they should make an effort to reduce the costs of repairing the accidents in order to moderate the increase in the price of the policies for the insured.
On the other hand, this is a move that strengthens the control of the insurance companies in vehicle repairs, and gives them for the first time a foothold also in influencing the activities of the garages with which they are not in working relationships.
The replacement car parts, which make up the majority of the market, come from several different suppliers and of different quality: an appraiser can order the use of a certain part, and the companies will supply it from another supplier and of a different manufacture, essentially dictating to the appraiser and the garage owner which part will be repaired.
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Ohad Maodi, Deputy Commissioner of Insurance.
Refuses to take a position on the issue (Photo: Capital Market and Insurance Authority)
And what does the man who is supposed to protect the insured and determine whether the move is legal and kosher say, or if it is indeed a harm to the insured?
In recent weeks, we have addressed the matter several times to the Commissioner of Insurance at the Capital Market Authority, and we have asked to receive the opinion of the Deputy Commissioner for Property Insurance Affairs, Ohad Maodi.
Maodi has repeatedly refused to take a public position on the burning issue.
The Capital Market and Insurance Authority responded that "the subject of vehicle repair costs affects insurance prices and has therefore occupied the Capital Market Authority in recent years. The Authority is promoting a reform in this area, one of whose goals is to reduce the price of spare parts for policyholders whose vehicles are damaged. The Authority does not accept a situation in which policyholders will be harmed and has determined Instructions obliging insurance companies to act transparently and fairly with the insured, even in the case of car claims."
The insurance companies: "to try and prevent the prices of the policies"
Direct insurance stated: "The increase in the cost of repairs due to the price of parts leads to an increase in the cost of insurance for the public. As part of the fight against the cost of living, the company works to contract with leading parts suppliers in the market to benefit from a discount on the prices of parts, and it allows its customers to benefit from it. As a result, customers can choose any garage without limitation, and the spare parts supplied are the same parts that the garage buys, of the same quality and at a lower price. The repair is approved solely in accordance with the instructions of the appraiser chosen by the customer - so that the customer enjoys the highest level of service at a lower price. Regarding the case in question, the company's policy is fully compliant with the law And of course, before handling the customer's claim, the customer knows about the replacement policy, which saves her money in the future premium."
Menora stated in response: "The company operates in accordance with the provisions of the policy and the law. The increase in the cost of repairs resulting from an increase in the prices of parts, brings with it an increase in insurance premiums for the entire insured public. Our company contracted with parts suppliers to enable the supply of parts at reasonable and fair market prices, thus trying to prevent a significant increase in the premium which is paid by our policyholders. As stated above, this conduct came into existence in order to give our policyholders the best and highest quality service, all in an attempt not to cause harm to our policyholders as a result of the abnormal and unjustified increase in the prices of spare parts."
The Phoenix stated in response: "The company is trying in every way to avoid increasing the cost of the insurance premium in the car policies, which is mainly due to an unrestrained and continuous increase in the prices of parts for repairing vehicles in the event of an accident. Our main goal and the goal of the pilot mentioned in this article is to keep our customers and avoid as much as possible additional increases in insurance prices." .
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