Why are some NZ insurance companies not supporting the BMW i3?

It’s been a tumultuous period for BMW’s quirky but embattled hybrid and fully electric i3 hatch. Numerous high-profile fire cases (including one in New Zealand) have put the platform in the spotlight, and BMW recently confirmed it would be getting phased out of the US market.

NZ Autocar recently discovered that Tower Insurance and TradeMe Insurance (which is underwritten by Tower) weren’t offering support to BMW i3 owners with either the range-extender REX model or the full EV model.

We initially came across a claim from an i3 owner that Tower Insurance had contacted them to say they could no longer insure their i3. As at the time of writing, those trying to get a quote for insuring an i3 with Tower (or TradeMe) get an automated message after they enter their plate number, saying “we’re sorry. This vehicle is not eligible for cover.”

Tower Insurance clarified to NZ Autocar that while it currently does not offer insurance for the i3, it plans to change this from mid-July onwards. In a statement, a spokesperson explained that the model was off the menu due to a lack of data around how much repairs on the model cost.

While the spokesperson didn’t delve into details, we suspect that this has to do with the model’s frequent use of carbon fibre, and how expensive it is to repair. Most notably, the i3 uses a carbon fibre tub — something generally only found on supercars.

“As new car models and technologies are introduced, we work as quickly as possible to gather local data on the cost of repairs to ensure we can offer the right insurance product at the right price,” said the Tower spokesperson.

“For a number of years there were simply not enough BMW i3s vehicles in New Zealand to allow us to gather enough data to develop accurate pricing for this vehicle. As the number of BMW i3s cars in New Zealand has increased we now have a clearer picture and expect to be able to offer policies for BMW I3s to new customers on our full-service digital platform from mid-July.”

After being notified of the i3 owner who’s claims triggered this story, Tower said it will make contact with them and reinstate their policy. “We were concerned to hear of this customer’s experience which was an unintended consequence of Tower transitioning this customer to a new system. We will reach out to the customer to apologise and reinstate their policy,” they said.

BMW New Zealand were unaware that i3 owners were being denied insurance with certain companies. They did note, however, that there are just two BMW-authorised body shops in Auckland which repair carbon fibre to BMW’s own specifications.

“BMW is not aware of any insurance company refusing insurance on the i3. Furthermore, their understanding is that their own insurance program (BMW Insurance – underwritten by Provident) is happy to ensure any and all of their EV products,” said a BMW New Zealand spokesperson.

“Carbon fibre is a specialist product and they have 2 repairers in Auckland who are both BMW Authorised Bodyshops who can repair it according to repair instructions. There are approved repair processes and replacement parts available for the i3 and the repair will depend on the type and severity of the accident, as with any other car.

“Also as with any car, the value of the car and the cost of repair must be balanced to ensure the repair is viable in terms of safety and cost. This is not solely related to the i3.”