Parts force insurance to declare total loss on crashed car – 10/28/2023 – Panel SA

Antonio Trindade, 66, is one of the best-known executives in the insurance market. As head of the National Federation of General Insurance (FenSeg), he monitors what has been a nightmare for companies and consumers: the delay in the delivery of damaged vehicles.

The repair has taken up to six months and has cost so much that insurers now prefer to declare a total loss.

Is this situation a reflection of the automaker crisis?
The pandemic affected the entire production chain. There was a shortage of components. Parts are missing. Then came the economic slowdown. Practically, all automakers stopped or ended production. The production of new cars fell, increasing the price of used cars by between 20% and 30%.

How has this affected insurance companies?
When you compensate for a car, they become deficient. In a partial vehicle accident, there is an inspection, approval for repairs, purchase and delivery of parts, repairs and delivery to the insured. The federation has a nucleus that monitors its members and monitors deliveries.

Is the delay that long?
Between January and March, there were 235 thousand automobile accidents and, of this total, 7% suffered from delayed parts. During this period, 40,700 pieces were ordered. The top ten automakers accounted for 91% of these orders. In August, there were still 7,100 pieces of this batch to be delivered.

Are they sophisticated?
Bumpers, headlights. I’m not even talking about mechanical components. The basics are missing.

Without the production of new cars, used cars became more expensive. Did this increase spending on the spare vehicle?
Very. In 2019, customers kept an extra car for 11 days, on average, while accredited workshops waited for parts. Today, there are at least 25 days. Insurance companies would love to resolve this quickly. The faster it is, the less you spend on renting a spare car. If a piece is going to take two, three months, even six months to arrive, we immediately pay for the total loss. It has been a practice in the market and I hope it does not become a new normal. We keep the rescue and life goes on.

But that account doesn’t stay with you, right?
These things are automatically passed on. The assessment is that the absorption of this cost could impact the price of upcoming vehicle insurance renewals. Somehow this ends up in the hands of the consumer.

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X-ray | Antonio Trindade, 66

Training: Administration with MBA from INSEAD

Career: He started at SulAmérica in 1977. With more than 40 years of experience in insurance, he was executive director of Itaú Seguros. In 2015, he assumed the presidency of Chubb in Brazil and today chairs the board of directors.

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