Wednesday, 28 August 2013 19:06

Retro News: September 1993, 1998, 2003, 2008

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20 years ago in the collision repair industry (September 1993)

In a unanimous vote, the Automotive Service Association (ASA) Collision Division Operations Committee rejected a proposal by CCC Information Services to have ASA endorse the new CCC Collision Center Connection program.
The CCC marketing program requires a shop to pay $499 verification fee to sign up for the program. The business is then charged a $30 to $50 referral fee for each insurance claim directed by CCC to the shop.
“Quite simply, the costs for adjusting a claim are the responsibility of the insurer, and this attempt to shift this burden to the repair facility is clearly not in the best interests of our members, the consumer or the repair industry,” said Bob Anderson, chairman of the ASA committee.
“ASA has been involved in extensive industry research that concludes that the claims handling system utilized today by most insurers is archaic and inefficient,” Anderson said. “This (CCC) referral program in its current form does little to alter the status quo. Since this third-party intervention does nothing to streamline the claims handling process, it is likely that even more friction (costs) will occur.” — from Automotive Dateline

15 years ago in the collision repair industry (September 1998)

A court ruling in West Virginia gives that state one of the strictest laws in the country regarding parts used in collision repair. Judge Charlie King wrote in a court opinion that insurance companies must pay for new OEM parts to fix body damage on newer vehicles. King ruled that repairs on vehicles still covered by a manufacturer’s warranty and less than three years old need to be made with new factory parts.
“I think it’s a real good decision for consumers in West Virginia,” Assistant Attorney General Doug Davis said. “If you get into a wreck in a car, insurance companies can’t force you to accept junkyard parts.”
The ruling apparently settles a heated dispute among insurance companies, automotive recyclers and the state Attorney General’s office. The case was brought to the court by a consortium of insurance companies that wanted a judicial interpretation of s state law. That law requires the use of “genuine crash parts,” and the insurance companies contended that this included new parts and OEM parts taken from wrecked vehicles. The state Attorney General’s office challenged that interpretation.
► A judge in West Virginia last year issued a injunction against Liberty Mutual to force the insurer to stop using remanufactured, reconditioned and used parts in violation of this state law; the judge also ordered the insurer to release the names of vehicle owners who had their vehicles repaired with salvage parts.

10 years ago in the collision repair industry (September 2003)

Allstate Insurance Company and Sterling Collision Centers have filed a lawsuit challenging the new Texas law prohibiting insurers from purchasing further interest in collision repair shops.
In the pleading, Allstate claims that HB 1141 “stops dead in its tracks a promising, market-based mechanism for improving customer satisfaction, providing efficient, cost-effective auto collision repair services, and eliminating incentives for waste and fraud in auto repair estimates and actual repair work.”
Allstate asserts that forbidding insurers from acquiring, expanding, supporting or promoting its interstate network of Sterling collision repair shops is a violation of the corporation’s protected free commercial speech.
The real purpose of HB 1131, according to the lawsuit, is “to turn the American business model—where competition brings out the best—on its head by protecting and insulating local Texas autobody shops from having to compete with Allstate’s (or any other insurance company’s) own collision repair operations.”
► As reported in Autobody News. The legal battle over the Texas law lasted until 2008 when the Texas Supreme Court rejected Allstate’s request to consider the insurer’s challenge to the law. ASA’s Bob Redding predicted that other states, which had previously considered legislation similar to that of the Texas bill, would pass such restrictions on insurer-owned shops after the Texas law was upheld, but none have. Unlike other larger MSOs, Sterling has added relatively few new shops since 2008.

5 years ago in the collision repair industry (September 2008)

Following a similar decision by State Farm back in June, Allstate announced this month it would no longer specify full-body sectioning (or “clips”) on its estimates.
“Furthermore, only when a collision repair facility is confident that a full-body section is the appropriate repair, has the proper training and equipment to facilitate a quality repair, and has the approval of the customer or claimant for such repair, will the adjuster authorize it,” the Allstate policy states.
Allstate’s Tech-Cor research center developed full-body sectioning procedures in the 1980s, but the insurer now says “changing vehicle construction techniques” and “the varying metallic composition of some modern vehicles may prevent collision repairers from facilitating a quality repair” using such procedures.
As with State Farm, Allstate had been pushed on the issue of clips by Pam Pierson of Princeton Auto Body in Princeton, Ill. Just days before Allstate’s announcement, the Alliance of Automotive Service Providers of Illinois said that based on Pierson’s efforts, it had appealed to Illinois State Representative JoAnn Osmond to ask the state Attorney General to provide a legal written opinion on the use of full-body sectioning.
► from CRASH Network (www.CRASHnetwork.com), September 22, 2008

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