The Insurance Council of New Zealand (ICNZ) and its member car insurers are looking into allegations that a company had been misrepresenting car parts as genuine and selling them to repair shops.

“We understand that, since late last year, a supplier has provided car parts as car manufacturer branded when they are not,” ICNZ chief executive Tim Grafton said in a statement. “The matter is naturally of concern to insurers who have established dedicated teams to investigate the situation.”

The company under investigation has been identified in a Newshub report as Auckland-based A&W Autospares. The issue reportedly emerged after a former employee claimed that the company bought aftermarket parts and placed “genuine” stickers before selling them at huge mark-ups.

As part of their investigation, insurers are determining whether their customers’ vehicles have been fitted with parts from the company and whether any misrepresentation has occurred, according to ICNZ.

Grafton added that any affected customers will be contacted by their insurer to chart their next course of action. He revealed that many customers have already been contacted, with more to come as the investigation progresses.

The insurance body is working with affected car repairers, and it has also contacted the Commerce Commission and other relevant government agencies to help address the issue.