Thursday, 30 September 2004 17:00

New CA law means the end of Progressives Concierge

California independent body shop owners got a boost on September 29 when Governor Arnold Schwarzenegger signed a bill that amends the automotive repair laws (Business & Professions Code Sec. 9880) to more strictly define who the customer is when a vehicle is being repaired, making it clear that an insurance company paying to repair a car is not the customer and cannot take the place of the customer. 

The new law "would prohibit the current Progressive Concierge Program and others like it," said California Autobody Association President David McClune, "which encourage customers to drop off their vehicles at insurance centers, pick up a rental car and leave while allowing the insurer to "step into the shoes" of the customer and to make all the critical repair decisions including where the car is to be repaired.

Our members are very concerned about any insurance program that takes away consumer rights and limits the decision-making process for consumers, and we are pleased with the efforts of Assemblyman Bermudez in this regard."

Jack Molodanof, CAA general counsel and lobbyist stated that "this new law in California puts the final nail in the coffin for the Progressive Concierge Program, as we know it."

McClune also told CAA members in a newsletter that the law raises issues as to whether it prevents insurance company owned body shops from repairing their own insureds' vehicles.

Aside from its impact on the Progressive Concierge Program and insurer-owned shop issues, the law makes it very clear that the vehicle owner or a designated representative - which cannot be the insurance company - must approve all changes to the estimate before the work is done. Shops that presently follow a policy of calling an insurer for a supplement, then proceeding with the repair as soon the insurer says OK but fail to bring the vehicle owner into the loop will find themselves without the proverbial "leg to stand on" when the BAR comes calling.

Language of A.B. 1079

Pertinent sections of the new law are as follows:

"Customer" means the person presenting a motor vehicle for repair and authorizing the repairs to that motor vehicle. "Customer" shall not mean the auto- motive repair dealer providing the repair services or an insurer involved in a claim that includes the motor vehicle being repaired or an employee or agent or a person acting on behalf of the dealer or insurer.

The automotive repair dealer shall give to the customer a written estimated price for labor and parts necessary for a specific job. No work shall be done and no charges shall accrue before authorization to proceed is obtained from the customer. No charge shall be made for work done or parts supplied in excess of the estimated price without the oral or written consent of the customer that shall be obtained at some time after it is determined that the estimated price is insufficient and before the work not estimated is done or the parts not estimated are supplied... If that consent is oral, the dealer shall make a notation on the work order of the date, time, name of person authorizing the additional repairs, and telephone number called, if any, together with a specification of the additional parts and labor and the total additional cost, and shall do either of the following:

(b) The automotive repair dealer shall include with the written estimated price a statement of any automotive repair service that, if required to be done, will be done by someone other than the dealer or his or her employees. No service shall be done by other than the dealer or his or her employees without the consent of the customer, unless the customer cannot reasonably be notified. The dealer shall be responsible, in any case, for any service in the same manner as if the dealer or his or her employees had done the service.

(c) In addition to subdivisions (a) and (b), an automotive repair dealer, when doing auto body or collision repairs, shall provide an itemized written estimate for all parts and labor to the customer. The estimate shall describe labor and parts separately and shall identify each part, indicating whether the replacement part is new, used, rebuilt, or reconditioned. Each crash part shall be identified on the written estimate and the written estimate shall indicate whether the crash part is an original equipment manufacturer crash part or a nonoriginal equipment manufacturer aftermarket crash part.

(d) A customer may designate another person to authorize work or parts supplied in excess of the estimated price, if the designation is made in writing at the time that the initial authorization to proceed is signed by the customer.... For the purposes of this section, a designee shall not be the automotive repair dealer providing repair services or an insurer involved in a claim that includes the motor vehicle being repaired, or an employee or agent or a person acting on behalf of the dealer or insurer.

 

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Bermudez
Introduced by Assembly Member Rudy Bermudez (D-Norwalk), A.B. 1079 not only defines the auto repair customer but prevents an insurer from acting as an agent of the customer. It states that every repair estimate must be approved by the customer, and that any changes in that estimate, such as a supplement, must be approved directly by the customer and not by the insurance company.
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