Speaking to the Herald's Driven magazine, Murphy said the Government and rental car companies needed to play a bigger role in ensuring drivers from overseas were safe on our roads.
Tourists should also have to prove they had some experience behind the wheel.
During an interview about his role as Men's Health Week ambassador and his work with the Motor Trade Association, the four-time Bathurst winner raised concerns about overseas drivers in New Zealand following recent, high-profile fatal car crashes.
"It's been proven that our driving conditions and driving on the left side of the road are playing a part [in tourist crashes]," Murphy told Driven.
"There has to be far more than just turning up with an international licence ... Everyone who comes to New Zealand as a tourist renting a car or campervan should have proof of length of licence. I would suggest at least four years minimum," he said.
Murphy, who has returned to New Zealand with his young family after racing fulltime in Australia in the V8 Supercar series for nearly 20 years, urged the Government to introduce legislation ensuring the competency of overseas drivers was checked before they could hire vehicles.
Working with rental vehicle companies was part of this, he said.
Over the Queen's Birthday weekend, four people were killed by foreign drivers in two fatal crashes. Dutch man Johannes Appelman, 52, has been charged over the Canterbury crash which claimed the lives of schoolgirls Abigail Hone, 12, and Ella Summerfield, 12, and Ella's mother Sally, 49.
American tourist Cody Dickey, 23, was this week fined $5500 and disqualified from driving for 18 months for causing the death of Auckland grandmother Robyn Derrick, 52, in a crash on the Coromandel Peninsula.
Murphy said the Government and rental car companies needed to be able to prove overseas motorists could safely navigate New Zealand roads before allowing them to drive.
"The Government has done some very good things, but this is clearly a problem that needs some attention very quickly.
"It would be quite wise that we ... check [overseas drivers] are competent before we give them the keys to a vehicle. If that involves doing an oral test and doing some sort of test online before they arrive ... we need to have a better understanding of their competency before handing the keys over."
Barry Kidd, chief executive of the Rental Vehicle Association, said any testing of overseas drivers here could have implications for Kiwi travellers wanting to drive overseas.
"I think it's an impractical solution and I think there are a number of issues that it would raise for our drivers overseas," he said.
Many operators already provided instruction booklets and links to online videos about driving in New Zealand for overseas drivers, he said.
Automobile Association motoring affairs general manager Mike Noon said there needed to be extensive research and analysis into crash statistics before any changes were made.
"There are 2 million tourists coming through New Zealand each year and it would be naive to think they wouldn't be driving.
"We need to understand if there are any particular different trends in these [tourist] crashes compared to crashes that involve New Zealanders."
Associate Minister of Transport Michael Woodhouse said transport officials were working on a special project targeting overseas drivers.
"As part of the project, research is being undertaken to better understand why overseas visiting drivers are experiencing difficulties on New Zealand roads and how safer choices can be encouraged," he said.
- by Liz Dobson, Teuila Fuatai, Mogan Tait
Foreign drivers at fault
558 crashes resulting in death and injury in 2013 involved overseas drivers
75% of the cases were caused by overseas drivers
11 of these ended in deaths
7 of the fatal crashes involved overseas drivers who "failed to adjust to local conditions"
Source: New Zealand Transport Agency