Uninsured car accidents could cost more than a year in university

Uninsured car accidents could cost more than a year in university | Insurance Business

Uninsured car accidents could cost more than a year in university

Auto insurer AA insurance has recorded around 8,000 claims involving at-fault uninsured drivers with damage caused adding up to $26 million. Among these accidents, 320 were more expensive than a typical year in university.

According to Amelia Macandrew, customer relations manager for AA Insurance, the average fees and costs of a year of tertiary study in 2020 was $11,484. Meanwhile, the average cost of damage that these uninsured drivers were financially liable for was $19,114, or $6.1million collectively.

The insurer’s 2020 Lifestyle Survey revealed that 63% of Kiwi drivers have been involved in an accident and 65% of those have had one or more accidents before they turn 30. Despite that, younger drivers were less likely to strongly believe that car insurance is important (70% of drivers aged 18-29 versus 86% of those aged 55 years and above).

In one case, an uninsured young driver lost control of his vehicle in a mall car park and ended up hitting the car of an AA Insurance customer and smashing it against a wall. The uninsured driver is now liable to pay $40,600 for the total loss of the other car, at $100 a week for the next eight years. According to the insurer, sixteen uninsured drivers have been paying off their debt since 2008, at a combined total of $87,000.

“Just like a student loan, it can take years, if not decades, for some uninsured drivers to pay off their debt,” said Macandrew. “However, unlike students who have invested in their education to set them up for future, uninsured drivers are simply clearing their debt caused by a driving mistake. Imagine what that money could have otherwise been spent on?”