The NSW Government has announced an inquiry into motor vehicle repair work in the state, covering insurer relationships and contracts with repairers.

Fair Trading Minister Anthony Roberts says the Motor Dealers and Repairers Bill is now before the NSW Parliament, following proposed reforms to the sector launched in 2011.

“We have been working with stakeholders over the past six months to determine the key issues affecting the industry and how these affect consumers,” Mr Roberts said.

The Motor Vehicle Industry Advisory Council was asked this year to develop terms of reference for a public inquiry.

Earlier this year NRMA Insurance blacklisted some car repair shops due to poor-quality work and, in some cases, fraud. Several panel beaters in turn accused the insurer of “bullying” customers into choosing repairers from its network.

The inquiry, chaired by Nationals MP John Barilaro, will examine consumer choice, protection and knowledge on repairs under insurance policies, and the effectiveness of the Motor Vehicle Insurance and Repair Industry Code of Conduct.

“These comprehensive terms of reference will allow the inquiry to determine whether the relationship between insurers and repairers meets the principles of consumer choice, transparent business practices, effective dispute resolution systems, a competitive marketplace and, importantly, the safety and quality of repairs,” Mr Roberts said.

Suncorp says it will discuss challenges facing the repair industry and how insurers and repairers can work together.

“The smash repair industry is facing unprecedented change and advances in motor vehicle technology that are effectively restructuring their businesses,” Head of Motor Claims Leigh Bryan said.

Suncorp says it has co-developed Australia’s first national repairer standard.

The Insurance Council of Australia says motor insurance is highly competitive and there is a shortage of qualified repairers.

It will consult with members on information to supply to the inquiry, including the benefits of the code of conduct, a spokesman told insuranceNEWS.com.au.

Members under the General Insurance Code of Practice must accept responsibility for workmanship and materials when they have selected and authorised a repairer.

Motor Traders’ Association NSW CEO Greg Patten says the inquiry follows consultation with the Government in the past six months “about our concerns with the relationship between insurers, smash repairers and consumers”.