New Zealand's used car market is built on Japanese domestic market (JDM) imports. With an average landed cost of approximately NZD $7,700 per vehicle — and JEVIC-inspected stock arriving regularly at Auckland, Wellington and Lyttelton — JDM imports make up the majority of used vehicle sales at New Zealand's independent dealerships. But importing and selling these vehicles creates specific insurance challenges that differ from locally-sourced used car dealerships.
The JDM Import Pipeline: Where the Risks Are
Understanding where insurance exposure sits requires understanding the import process:
In Japan (pre-export): Vehicles purchased at Japanese auction houses are subject to their own local insurance arrangements. Your liability typically begins at the point of purchase and is transferred through the export process.
In transit (sea freight): Once vehicles are loaded onto a roll-on/roll-off (RoRo) vessel, they are in the marine transit phase. This is one of the highest-risk points — vessel fires, weather events, and loading/unloading incidents occur. Standard motor trade insurance does NOT cover vehicles at sea.
At the wharf/port (NZ arrival): Vehicles sit in port yards awaiting compliance inspection and customs clearance. Theft, damage and weather events occur at this stage.
Compliance and compliance workshop: Some vehicles require modification or repair to meet NZ requirements. This creates professional indemnity exposure for compliance workshops.
At your yard: Once on your premises, standard vehicle stock cover applies.
On the road: Road risk cover applies when moving vehicles from the port or between locations.
Marine Cargo Insurance: The Critical Gap
The most important — and most frequently overlooked — insurance requirement for JDM importers is marine cargo insurance.
Marine cargo cover protects your vehicles while they are:
Without marine cargo cover, a vessel fire, a major weather event, or port-related damage leaves you with no recovery against your insurer. Marine cargo claims are not uncommon — RoRo vessel fires have affected multiple cargoes in recent years.
Marine cargo insurance should be arranged before your vehicles depart Japan, and should cover the full CIF value (cost + insurance + freight) of the cargo.
Stock Cover for JDM Vehicles
Once on your yard, JDM vehicles need standard vehicle stock cover. Key considerations for import dealers:
Valuation: Stock should be insured at landed cost plus compliance costs and margin, not just purchase price. Agreed value cover avoids depreciation disputes at claim time.
High turnover: JDM dealers often turn stock quickly. Ensure your sum insured reflects your peak stock value, not average holding.
Compliance failures: If a vehicle fails NZ compliance and cannot be sold, this is a commercial loss rather than an insurable event. Insurance covers physical damage and theft — not regulatory failures.
The Consumer Guarantees Act for JDM Dealers
Selling JDM vehicles carries CGA exposure just like any other dealer. Specific considerations for JDM stock:
Odometer accuracy: Odometer disputes are one of the most common issues with JDM imports. Japanese vehicles with rolled-back or unverified odometers create direct CGA liability.
Damage history: Import vehicles with undisclosed accident damage create CGA and Fair Trading Act exposure.
Specification differences: Japanese domestic market specification may differ from NZ market vehicles. ADAS, safety systems, and fuel compatibility may vary.
Professional indemnity insurance is essential for JDM dealers to cover these disputes.
Getting Marine Cargo Right
Marine cargo insurance is a specialist product, separate from standard motor trade insurance. Not all motor trade brokers have expertise in marine cargo. Ensure your broker:
Contact our specialist team to arrange comprehensive cover for your JDM import operation — including marine cargo, yard stock, road risk and dealer liability.