National Transport and Safety Authority officers inspect vehicle
insurance stickers. A petitioner wants insurance companies stopped from
identifying parts for their clients’ vehicles. FILE PHOTO | NMG
Motor vehicle insurance companies will no longer be identifying
spare parts for their clients’ vehicles after an accident, if a petition
filed at the High Court succeeds.
The petition by Mr
Allan Gikendi states that the practice by insurance companies to
identify parts for their clients’ vehicles, so as to maximise profits,
has led to cars getting low quality service.
Mr
Gikendi, who filed the petition on March 27, has named the
Attorney-General, the Insurance Regulatory Authority and the Kenya Motor
Repairer Association as respondents.
“Recently,
insurance companies under the very watch of the respondent have
overstretched their mandate beyond the permissible limit and adopted a
scheme of controlling the repair process through dictating which spare
parts repairers should use and or where to source for the parts. This
scheme adopted by the repairers has inevitably caused chaos in the
repair process as repairers have been forced to use substandard parts
since insurers insist on cutting costs to maximise profits,” states Mr
Gikendi in his petition.
He argues that auto repair is a highly technical field and
insurers cannot be seen to have expertise in determination of
suitability and quality of body parts of motor vehicles.
“Given
the lack of expertise in determining suitability and quality of a body
part on a motor vehicle, the insurer can only guarantee suitability of
such body parts by sourcing for original genuine parts from the
manufacturers or from their authorised dealer and not from second-hand
shops and or sourcing for used parts. The quality and suitability of
second hand parts in auto repair can only be determined and guaranteed
by the repairer, given their expertise,” reads the petition.
He
argues that since the Consumer Protection Act, 2012, provides that a
repairer warrants all new and second-hand parts installed for a minimum
of 90 days or 5,000 kilometres, whichever is earlier, body parts —
unless original from the manufacturer — cannot be guaranteed by a
repairer.
“The actions by the insurers of sourcing for
parts without the involvement of the repairers and the consumers and or
motorists is tantamount to an illegal and unorthodox amendment of the
provisions of section 55 and section 5 of the Consumer Protection Act No
46 0f 2012,” he argues.
“The
lack of complaint by motorists is not a justification for such scheme
as adopted by the insurance companies as the motorists do not have the
technical know-how of complex auto repair and further the quality of
work not being external cannot be judged by such a motorist with no
technical know-how of what comprises quality and thus putting the
motorists in a weak bargaining position.”
He says that
some insurance companies have also opened assessment yards where
repairers are sent to assess damage and give quotations for repairs and
the job given to the lowest bidder.
“Inevitably,
repairers are forced to quote lower in order to get the work and
consequently they are forced to use substandard parts in order to
compensate for the reduction in prices at bidding stage, thus
compromising on the interest and particularly safety of the motorists,”
reads the petition.
The petition is premised under the
Consumer Protection Act, which heavily protects vehicle owners from the
excesses of repairers.
The petitioner is accusing the Insurance Regulatory Authority of neglecting its duty to protect motor vehicle owners.
The hearing is set for July 30.
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