Phones: Insurers easy, bosses strict

Insurance firms say the law on drivers using mobiles will not affect policies. Photo / Stuart Munro

Cellphone use may not affect drivers' insurance claims in the case of an accident, but employers are taking a hard line.

A law change banning the use of handheld mobile phones while driving will come into force on Sunday, but most insurance companies say this will not affect their policies.

But many employers are introducing policies under which workers who crash a company car while on the phone are likely to face disciplinary action.

Tower Insurance head of product and marketing, Mike Clapp, said claims would be declined only if cellphone use was considered reckless - a clause that affected less than 1 per cent of cases.

"In general terms, claims will be paid for unless someone acted particularly recklessly or unreasonably. [But that would] certainly be the exception rather than the norm.

"An accident is an accident. Being reckless has to be quite extreme."

Handling a cellphone would be treated the same as speeding, and most claims involving speeding were paid out, Mr Clapp said.

Susanne Wolton, head of strategy, pricing and corporate affairs at AA Insurance, said the law change addressed a safety issue but it did not affect insurance coverage.

Every claim was judged on its merits and could be declined if the driver did not "take all reasonable steps to protect the safety of the vehicle at all times", she said.

"We wouldn't decline claims unless cellphone use was a significant contributor to the accident. It isn't clear cut. It's exactly the same approach we take with speeding."

Most insurance policies have specific clauses against driving under the influence of alcohol or drugs, but neither Tower nor AA Insurance said it had plans to create a similar clause for cellphone use. NAC Insurance claims team leader Wayne Ballantine said drivers could face having their claims being turned down if cellphone use was deemed the significant cause of an accident.

This was more likely if the driver was clearly at fault, he said.

David Lowe, employment services manager at the Employers and Manufacturers Association Northern, said businesses recognised the public relations value of cellphone use in company vehicles and had been creating policies around the issue.

Minor breaches of cellphone use would probably result in just a talk, but a crash could bring disciplinary action, Mr Lowe said.

BP spokeswoman Diana Stretch said the company had had a strict "phone on, engines off" policy for about 10 years. Depending on the severity, employees who breached the policy could receive disciplinary action for using a cellphone while driving.

The company had been involved with research into the dangers of driving while on the phone, and considered it as risky as drink-driving.

A Fonterra spokesman said the company had had a mobile phone policy that restricted cellphone use to hands-free systems since 2006.

Breaches of the rules, such as crashing a company car while using a handheld phone, would result in a disciplinary process.

But Mr Lowe said cellphone rules could be liberating for employees because the law meant they could let calls go to voicemail - even those from a valuable client.

"It's a little bit like if your wife rings to give you an earful on the way home, it can be a good excuse not to answer. Similar scenarios happen in the workplace."

* The ban and how it will be enforced

TOWER INSURANCE

Insurance claims will be upheld even if a driver is illegally using a cellphone at the time of an accident, unless the action is considered reckless.

"In general terms, claims will be paid for unless someone acted particularly recklessly or unreasonably. [But that would] certainly be the exception rather than the norm."

Relevant policy clause: Drivers may be excluded if they acted in a criminal, reckless or unreasonable way.

No plans to include specific clause in policy for cellphone use.

AA INSURANCE

Claims will not be declined unless cellphone use is shown to be a significant cause of accident.

"We wouldn't decline a claim unless cellphone use was a significant contributor to the accident. It isn't clear cut. It's exactly the same approach we take with speeding."

Relevant policy clause: Drivers must take all reasonable steps to protect the safety of the vehicle at all times.

No plans to include specific clause in policy for cellphone use, similar to one already existing for driving under the influence of alcohol or drugs.

STATE INSURANCE

Claims might be declined if there is "reckless or irresponsible" use of a cellphone.

Relevant clause: Reasonable care must be taken to prevent a claim occurring.

Company employees are no longer permitted to use a cellphone while driving, and hands-free kits will be phased out.

NAC INSURANCE

If a driver is found to be at fault in an accident, there is a "strong possibility" a claim could be denied.

"It's fair to assume that because you've broken the law, that's why the accident happened."

No directive yet given to claims team on how to handle accidents involving cellphone use.

EMPLOYERS AND MANUFACTURERS ASSOCIATION NORTHERN

Businesses have been creating cellphone-use policies for company cars in consideration of public image.

Crashing a car while on a cellphone would likely result in "more than just a reminder".

BP COMPANY POLICY

"Phone on, engine off" - staff not permitted to use cellphones at all in a car while working.

Depending on the severity of a breach, employees could be disciplined for using a cellphone while driving.

Global policy in place for about 10 years.

FONTERRA COMPANY POLICY

Employees are not permitted to use handheld cellphones but may use hands-free sets.

Employees who breach the rules are subject to the company's disciplinary processes.

Policy in place since 2006.