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Thursday, 22 March 2012 16:05

Helpful Documents, Tools And Information Only a Click Away for Shops

Looking for tips, tools and resources to help your business, defend your positions or do your part for the industry? Here’s a collection of links to sites, documents and information you may find interesting and useful.

— Motor Information Systems has released a revised edition of its Guide to Estimating (http://tinyurl.com/7zhbvr3), its explanation of what is and is not included in its estimating labor times (the system used by CCC Information Services). Revisions made in the February 2012 version are highlighted in blue within the guide.

The new guide, for example, indicates that recalibration of the steering angle sensor is not included in Motor labor times. Bumper labor times are now shown to include lamps when mounted to the bumper but not include optional equipment lamps or those not mounted to the bumper. Labor times for fender inner panels are now shown to include grinding, filling and smoothing welded seams up to 150 grit sandpaper. The guide adds electrical wiring to the list of non-included items on frame labor, steering column overhaul, trunk lid, lift gate and quarter panel times. Hinge pillar glass and moldings are now listed as included in cowl, hinge pillar and dash panel times.

— I-CAR has actually lowered the cost of its online training (http://tinyurl.com/7rsb2sb) to make it comparable (on an hourly basis) to the fee for its live, classroom training. There are now more than four dozen online classes available, some vehicle-specific (such as “Ford F-150 Frame Replacement”) and others more general (such as “MIG Brazing”).

— Although the National Highway Safety Administration (NHTSA) said earlier this year it had found no discernable defect that led to two fires in Chevrolet Volts weeks after they crashed, it is standing by its recommendation (http://tinyurl.com/7jd88tu) that shops not store severely-damaged vehicles with a lithium-ion battery inside or within 50 feet of a structure or another vehicle.

— Whether or not your shop participates in State Farm’s “Select Service” program, it can be interesting to check out the program’s revised shop locator system (http://tinyurl.com/ 7yegybx) that policyholders, agents or claims personnel can use to locate a participating shop. Rather than locating shops based solely on proximity, the system now ranks shops based on their current performance score from State Farm (although those scores aren’t shown on the site). Interestingly, only three shops appear on first page of search results; users have to click through to subsequent pages (each of which lists five shops) to see additional shops - potentially including shops that could be much closer to their home or work than ones higher up on the search results.

— Ask shops about their nagging concerns about the future, and chances are they’ll mention the increasing crash avoidance technology on new vehicles. They probably weren’t heartened by the fact that David Strickland of the National Highway Traffic Safety Administration recently said his agency will decide next year whether to mandate vehicle-to-vehicle communication technologies in new cars, which he said could address up to 80 percent of crash scenarios

“We have been working on this notion for over a decade,” Strickland said, according to the Detroit Free Press. “We really do feel very bullish on the prospect of getting it on the ground.”

But those who make a living based on auto crashes can take some measure of comfort from a recent report (http://tinyurl.com/7ujp5ws) from the Highway Data Loss Institute. It says that even with such mandates, it can take decades before new safety features are in 95 percent of vehicles on the road. According to the report, it won’t be until 2016 that 95 percent of vehicles have front airbags, for example, and until 2028 for side airbags.

Based on that trajectory, forward collision crash avoidance technology won’t be in 95 percent of registered vehicles until 2049, the Institute predicts.

— And just in case you want to read more about future vehicle technology, an article (http://tinyurl.com/ 6s88yp6) in a BBC news magazine asks, “How close are we to a crash-proof car?” It quotes a Volvo technical adviser who says the automaker has pledged that after 2020, no one will be killed or seriously injured in one of the automaker’s new cars.

And Wired magazine in February (http://tinyurl.com/7foslf4) featured a fascinating look at the “autonomous car,” one that essentially drives itself.

— This may come under the sarcastic heading of, “Tell me something I didn’t know,” but the highly-publicized report (http://tinyurl.com/6ukvr4s) regarding paint and materials compensation methodologies released earlier this year also found that while average costs for paint and materials have grown by 50 percent since 2005, the average compensation rates paid by insurers have risen by only 23 percent.

Much of the coverage of the study focused on the fact that it found that 64 out of 68 industry participants interviewed think the current way paint and materials compensation is calculated is a poor methodology. Only four people (including representatives of three repairer operations and one estimating system provider) rated the current system as “adequate” or “good.” The study concluded the current system is flawed in part because on smaller jobs, repairers do not receive adequate compensation, and for large repair jobs, insurers believe materials charges become excessive.

The study, conducted by Richfield Associates and commissioned by ComputerLogic (which produces the PMCLogic paint and materials cost- calculation system), included interviews with shops, insurers, suppliers, association executives, consultants and trade publication editors.

—If you’re interested in some documents that challenge the insurance industry, the Consumer Federation of America issued a report (http://tinyurl.com/6phzony) earlier this year that says insurance premiums have become an undue economic burden on low- and moderate-income Americans, and that state regulators should do more to help reign in these costs.

“What is undeniable is that high auto insurance costs for (these) households either impose a substantial financial burden or greatly limit economic opportunity, especially access to jobs,” said the report’s authors, who are a former Texas regulator and the executive director of insurance at the Consumer Federation of America.

The report suggests lowering minimum liability limits, creating special programs (as has been done in California and New Jersey) to help low-income Americans get cheaper insurance coverage, and eliminating policy pricing elements (such as education level and credit history) that hurt low-income households.

Meanwhile, another recent report from a coalition of consumer groups says Insurers overstate their industry’s financial losses from natural disasters and otherwise manufacture perceived crises to allow them to dramatically increase premiums and profits.

The report (http://tinyurl.com/ 7t6h8d2) says Americans have for 35 years been “victims of this industry’s little-understood economic cycle, created by anticompetitive (yet legal) underwriting practices, unique and opaque accounting policies and virtually unchecked power when it comes to regulation of insurance rates.”

The report from Americans for Insurance Reform—a project of the Center for Justice & Democracy at New York Law School that includes nearly 100 consumer groups—said insurers are once again using disasters like Hurricane Irene to end a 5-year “soft market” of stable rates and heavy competition among insurers, and replace it with a “hard market” marked by extreme rate hikes.

Insurers can overstate losses from disasters, the report says, because they are based on estimates of unknown future claims, which are, during “hard markets, wildly exaggerated.”

The study’s authors point out that insurers make plenty of profit in both types of markets not through underwriting but through investment of surplus that has been set aside for future claims. That surplus has risen by a factor of almost 40, the study states, and totaled $580 billion in 2010.

The report urges governments to require more data from insurers, gain more control over rates, and repeal insurer’s antitrust exemption under the McCarran-Ferguson Act.

John Yoswick, a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). He can be contacted by email at jyoswick@SpiritOne.com.

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