The following article from Insurance Times features a contribution from Copart UK’s Managing Director, Jane Pocock, who shares her thoughts on how consumers are divided over the use of green parts for repairs.
The use of recycled car parts for repair may be in its infancy, but industry voices predict a boost in business to align with consumer demands
Today, everyone from campaigning teen Greta Thunberg to trade association Biba are rooting for all things sustainable, focusing on promoting business practices that are environmentally kind.
The cultural focus on recycling and being green has now turned its laser-like attention to the insurance sector – in particular, the use of recycled car parts to complete insurance-related cosmetic repairs after road traffic accidents.
Jon Dye, chief executive at Allianz Insurance, said: “The world is more and more concerned about the ability to reuse things rather than just chuck them away.”
He added that the attention surrounding green parts is very much driven by “the whole ESG phenomenon”, which centres around the environment, social factors and governance.
Independent research commissioned by Allianz last October found that 69% of UK motorists would be receptive to accepting a green car part if a part on their current vehicle needed replacing; only 6% of the 250 respondents said a firm no to the use of green parts altogether.
Furthermore, 52% said they expected vehicle repairers to offer the option of green parts, whether or not they as consumers accepted this for their car repair or not.
More than three-quarters (77%) of respondents would be receptive to using green parts for their car’s repair if it was better for the environment; 74% said they would use green parts if it was more cost effective, while 36% would be more inclined to use green parts if they were quicker to source.
Based on these findings, Allianz Insurance is now trialling the use of green parts within its claims process – this includes using undamaged or reusable components from end-of-life accident damaged vehicles for car repairs.
Nick Rossiter, motor damage strategy manager at Allianz Insurance, said: “Recycled parts are not a new concept, but there has been a clear societal shift and more people are receptive to choosing environmentally sustainable solutions.
“Other benefits to using green parts include reduced repair costs, which could help reduce the pressure on claims inflation and can prevent delays in the repair process when new parts are not immediately available.”
Despite this clear indication of interest in the use of green parts, Copart UK’s managing director, Jane Pocock, believes consumers are more divided.
She said: “There’s some people that would be happy to have their vehicle repaired with green parts and then there are other people that would rather have the car salvaged and a new car because they’re worried about safety or it’s extensively damaged.
”There’s definitely a divide in views now.”
But, are ‘used’ car parts safe enough to fix accident damaged vehicles?
Pocock said that green parts used for cosmetic repairs, for example to replace wings, doors or headlights, are “really useful to promote recycling”. Using green parts to repair safety features, however, is a big no-no.
“We just need to be careful that it doesn’t stretch into parts that impact on safety or performance because then you don’t necessarily have the provenance of that part when it’s being fitted to your car,” she continued.
She added that there is “an element of responsibility that the insurers will be managing under their own terms and conditions”.
Rossiter, however, questioned the terminology used within the green parts market, blaming this for some safety misconceptions.
“Sometimes the term recycled parts has been used, which may have caused concern about how safe the parts are,” he explained. “Second hand doesn’t mean second rate.”
He continued: “Green parts are subject to strict inspections and Allianz will not be using any parts that are safety critical. This clearly demonstrates that more education and information should be available to highlight the benefits green parts can bring.”
Feeding the European market
Although green or recycled car parts are being trialled in the UK, Pocock said these parts are already being used in Europe due to the fact that many European cars have left-hand drive versus the UK’s right-hand drive; it is therefore beneficial to trade undamaged car parts as most collisions occur on the driver’s side, regardless of country.
Pocock said: “With us having right-hand drive cars, they’re often damaged on the right-hand side because it’s driver to driver that collide. Whereas in Europe, they’re left-hand drive, so often we’ve got a car with a left-hand side with no damage, so they’re very popular in Europe for them to use the left-hand side as part of the repair. Doors and wings, headlights are often exported and used for that kind of repair.”
The availability challenge
For Pocock, however, the primary challenge is one of availability.
This could refer, for example, to having the exact part available at the precise time of repair. This can prove problematic because green parts won’t necessarily come ready to use.
“They won’t get the whole part, or it’ll still be bolted to other parts,” Pocock explained.
“They’ve got some re-work to do before it’s useable in some cases, but there are a lot of dismantlers now specialising in this area and making it more user friendly.”
Pocock added that creating a nationwide green parts inventory could also be difficult due to the vast number of green part distributors, and that locating specific accident-prone parts could be tricky.
She said: “A lot of the cars that are damaged are front-end damaged cars, so if you’re looking to repair front-end damage, maybe green parts aren’t available.”
Although more insurers are opting to trial green parts within accident-related repairs, Pocock said the market is still very much in its infancy.
“In terms of accident repairs for policyholders, then that’s very much to the insurance company to regulate,” she added. “A lot of these repairs are currently in their infancy. We’re looking at this with interest because it would appear to be a growing market.”
Source: Read the full article at Insurance Times
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Categories: Industry News