5246
VIEWS
VIEWS
10 Oct 2012INSURANCE: Micro-dots Promise to Reduce Vehicle Theft
Recent Gauteng Business News
Micro-dotting involves printing miniature silicone chips with unique identification numbers, legible only when magnified â and then spraying these chips onto the underside of a vehicle and into the engine compartment. Since it is impossible to find and remove all the dots, police will use them to identify vehicle owners by cross-checking numbers on the National Information System (NATIS) data base. The process is expected to deter thieves and illegal auto-parts receivers as vehicles, or even their parts, can at any stage be traced back to their correct owner.
âThe advantage of this system is that since the tiny micro-dots are practically undetectable and are sprayed so broadly within the vehicle they will allow police to trace a vehicle even if the engine number is defaced or destroyedâ says Gari Dombo, managing Director, Alexander Forbes Insurance.
While micro-dotting is expected to reduce vehicle theft amongst new vehicles, theft of older, un-dotted, vehicles may well increase. Old vehicles will not be micro-dotted until they are sold on and re-registered. As such, it is anticipated that theft of older vehicles may well, initially, increase.
That said, âthere is nothing to stop owners of older vehicles personally installing micro-dots and, if the vehicle is stolen, informing the police of the un-registered micro-dots on the vehicleâ advises Dombo.
Either way, âfrom now on it will be much more difficult to clone vehicles. Chop shops will also find it harder to distribute parts since each part can now be easily linked to its NATIS-registered vehicle of originâ says Dombo.
Under these circumstances, simply placing a sticker on a vehicle, indicating that it has been micro-dotted may well act as a powerful deterrent to theft.
The upshot is that in future, vehicle theft and auto-parts crime is expected to become less of a factor - until the fraudsters improve their ways, that is. âOne only has to consider how the security features of our bank notes are constantly improved to see that it might just be a question of time before criminals circumvent current micro-dotting technologyâ adds Dombo.
For the meantime, however, since the bulk of premium costs are driven by vehicle accidents - not theft or crime - micro-dotting is not expected to reduce insurersâ premiums. In fact, vehicle theft currently contributes less than10% of overall premium costs.
âOne only has to compare the number of accidents, fender benders and scratches that your vehicle has sustained over the last few years - compared with the number of times is has been stolenâ explains Dombo.
That said, âmicro-dotting may well contribute to reduce the rate of future premium increasesâ adds Dombo.
Also, while micro-dots are a good security measure adopted in many countries, âconsumers should not expect rapid premium changes because vehicle theft costs will only reduce gradually as newer vehicles replace old onesâ cautions Dombo.
And even if vehicle theft and auto-parts crime reduces significantly, âany inflation increases may wipe out any positive effect that a reduction in vehicle crime might have on premiumsâ adds Dombo.
This is not to say that some insurers will not use micro-dotting in advertising to attract new vehicles to their books, much as they offer to beat any quote - or pay you R300! That is the nature of competition and advertising.
Also, since it is currently understood that manufacturers will be responsible for installing the micro-dots âwe imagine that the insurance industry will not take a hard line on innocent insurance clients who may be unaware of non compliance, or have older vehiclesâ suggests Dombo.
In time, however, as all new vehicles are registered, or older vehicles re-registered at sale, requiring that they go through roadworthy processes including micro-dotting compliance, micro-dots will become the norm, rather than the exceptionâ predicts Dombo.
Business News Sector Tags: Insurance|
