Source: Radio New Zealand
RNZ / Marika Khabazi
More AA Insurance customers say they’ve encountered strange changes to their vehicles’ value when their policies renewed.
RNZ reported at the weekend that one woman, Nicki, was upset that the value of her 24-year-old Subaru had increased two-and-a-half times when the policy renewed this year.
AA said it relied on an independent third-party data provider to provide vehicle values. “From time to time, this provider updates their methodology and data sources to ensure the valuations reflect the most accurate and up-to-date market conditions.
“When this happens, customers may see changes, either increases or decreases, in their proposed agreed values at renewal. We encourage customers to get in touch if they would like to discuss their proposed value or agree on a different value with us.”
One man who contacted RNZ said he had a 2003 Subaru Forester insured with AA Insurance that had an agreed value in 2024 of $6500.
“Last year, 2025, AA decided it should be only $2700, a sudden and completely unexpected 58 percent drop in agreed value. I was unable to find any data to support that valuation, complained, and eventually got a helpful staff member who explained that they use a third-party Australian service to value cars. I requested an agreed value of $6000. Fine.
“Now, this year. I have just received an insurance renewal notice with an agreed value of $9900, a whopping 3.67 times the agreed value they pushed one year ago, and, bizarrely, 10 percent more than I paid for the car 11 years ago. Once again I have been completely unable to find any data to support that valuation, and around $6000 to $7000 seems a reasonable agreed value range.”
Another said there seemed to be “something odd” going on.
“I’ve had a 2006 Audi A6 for six years, at the last renewal AA reduced the value of the car to about a third of my estimated value, without highlighting this at the time. I found this underhanded. This meant I was paying about $900 to insure a car for a maximum payout of $1500, with a $500 excess. They refused to raise the value.
“I had the same issue insuring a 2007 Audi A3, they’d only cover it for half what we paid.”
Consumer NZ insurance expert Rebecca Styles said insurers would usually offer the option of either market value or agreed value for car insurance.
“If people aren’t happy with the agreed value, they could shop around.”
She said it could be possible to find another insurer that took a different view.
Financial Services Complaints Ltd, an ombudsman service that deals with complaints that cannot be resolved between financial services providers and customers, has previously said it is important that people read their policies and understand the cover they have.
It has dealt with a number of cases where people have been upset at what insurers were willing to pay for their vehicles.
In one case, a man bought a specialist vehicle that he believed was insured for $39,000.
In late 2023 the vehicle was destroyed and he was upset to find the insurer would only pay $24,000.
He said his insurance broker had not made it clear he only had market value cover. FSCL investigated and said it was hard to see how well this had been disclosed to him.
The brokers offered to pay the difference between the market value of the car and the amount he would have received if it had been insured for agreed value. The policy said this would be market value plus 20 percent, or $4800.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
