FACE-VALUE POOR

Sun (Auckland), Volume 1, Issue 23, 19 April 1927, Page 11

FACE-VALUE POOR

THE £1 PROPOSAL FOR THIRD PARTY COVER Some member of a South Island local body, with the commendable idea of ensuring that all cars should be covered by third-party insurance, started a movement to get the Government to take this class of insurance over and give the cover at £ 1 a car, to be collected at the same time as the cars are annually registered. This idea received some support on the figures produced, and the latest convert is the South Taranaki Automobile Association. A DOUBT On first appearances the scheme might have an attraction, but a study of the position caused very considerable doubt. If one takes 150,000 as the possible registrations—and this includes all the classes which have proved bad risks—and deduces the post office charge for collection, the sum remaining is about £130,000. The originator of the £1 scheme saw enough to pay all the losses and provide some funds for roads out of this. Apparently he overlooked the fact that the insurance companies would be expected to provide cover for accidents, theft, and fire, apart from third-party. The immediate result, on the advent of such a scheme, would be many and costly disputes as to whether the company or the Government fund was liable in many accidents.

At present the companies settle the claims more or less amicably between themselves on the recommendation of the adjuster, and on the face of it the suggested scheme would mean two assessors instead of the present one, and legal costs galore. Imagine a head-on smash between two cars, costing say £2,000 in accident and thirdparty claims, and the resultant disputes. MOST CLAIMS BIG Third-party claims are very frequently stated in hundreds of pounds. The small claim is more or less infrequent. The costs of adjusting are heavy. Twelve assessors would be in the Dominion, probably more, to deal with the Government side, and the array of legal talent in a year would be huge. At a conservative estimate thirdparty claims in Auckland so far this year have reached £4,000, and for the year, even with amicable settlements, claims and costs will probably exceed £20,000. Claims in the Auckland area are reaching towards 80 a month. The accident toll is much heavier, but a great number of cars are not covered. If they were all covered by insurance, claims would probably double, and the money aspect would be never ending. ASKING TOO MUCH The Taranaki association suggested that the Government might subsidise the fund raised by the £1 levy. The general body of ratepayers would hardly appreciate the amount of subsidy necessary being handed over for distribution to erring and warring motorists, nor would the motorist who is more or less satisfied with his present insurance rate appreciate splitting it up between the Government and companies, knowing that an argument was almost certain if an accident, involving the third party, occurred.

Those who understand insurance expect a natural death to the proposal. That does not get away from the fact that too many people, who are potential liabilities to other road users, run cars without insurance. Many of them say they can’t afford to insure —which means that they cannot afford not to be insured. LIFE OF A CAR AN INTERESTING BULLETIN The results of a study to determine the normal life history of automobiles are given in a bulletin issued recently by the Bureau of Business Research of the University of Michigan. The study was conducted by C. E. Griffin. Professor of Marketing at the university, says a reviewer in “Roads arid Streets” (Chicago). The following conclusions are given by Professor Griffin in the bulletin: 1. The mortality rate for automobiles follows a curve similar in form to that for human lives and for various types of industrial goods. 2. The average life of motor-vehicle'* generally is 7.04 ars. 3. The average life of Ford cars Is substantially longer than the average life of all other cars as a group. 4. The average life of automobiles has shown a definite, though not a steady, increase. 5. The rate' at which automobiles of a given year’s Production are eliminated from use indicated by the fol lowing facts: Of any given 100,000 cars placed in use, 75 per cent will still be in use at the end of 4.75 years. 50 per cent at the end of 6.94 '*'"**rs, and 25 per cent at the end of 9.2 years. 6. The normal 4i exp-‘^ + *’tion of life ’ for cars of * ~es ~~ follows: For new cars it is 7.04 years; for cais 3.5 years of age. 4.27 years; * 6.5 years of age. 2.8 —s: for cars 9.5 years of age, 1.8 years; and for carr, 12.5 years of age, 1.2 years. 7. On of the cars in tb n '■'ding five years, 76.9 per cent of those produced in the preceding 10 and 71.3 per cent of those in the preceding 15 years, were still in use. 8. The average age f the cars in uson December 31. 1924, was 3.07 years 9. The replacement demand has shown * marked mcrease both abso lutely and relative to the total demand. This tendency will continue. It is predicted that the replacement demand oi 1926 will be' 1.700.000 cars: of 1927 2.063,000 cars; and of 1928. 2,341.000 cars. This increase in replacement de mand means shat the automobile market is approaching a stabilised condition. 10. At a rate of production of 4,000,000 motor-vehicles a (last year’s total was 4,480.000), and exports of 5 per cent of production, there would be in the United States in 1930 a total of 28,580.000 such vehicles, or one for every 4.3 persons of the estimated population for that year. It is often possible to stop a small leak in the radiator with Portland I cement. The exact source of the leak j should be found and the spot marked i with chalk, after which the water may Ibe drained off and the faulty spot cleaned with emery paper. The cement should be mixed into a stiff paste and pressed well into and around the crack. When it has set it may, with advantage, be touched up with black enamel.