NZ is set to introduce compulsory third party vehicle property damage insurance for drivers to ensure responsible motorists no longer foot the bill for the uninsured.

Transport Safety Minister Harry Duynhoven has been pushing the proposal for years and his Government appears to have finally given the green light to the policy with the preparation of an initial discussion document.

Though it is yet to gain formal cross-party support, the proposal is likely to acquire considerable political traction because “boy racers” are viewed as a problem in many parts of NZ. Mr Duynhoven hopes the proposal will also entice young drivers –¬ who can get a learner’s permit at 15 – to switch to safer vehicles so their premiums are cheaper.

The estimated cost to insurance companies of uninsured drivers in NZ is at least $NZ50 million ($43 million).

Insurance Council of New Zealand CEO Chris Ryan says the proposal has industry backing despite some cost concerns.

“A lot of people think it’s a good idea,” he said. “But it’s a relatively small pool [of drivers] and it could be quite expensive to administer.”

Third party injury insurance in NZ is covered by the state-owned Accident Compensation Corporation.