“Many consumers have lost their second largest asset, because an insurance company could save more money if they totaled a safely repairable vehicle. This practice is now prohibited thanks to Governor Chaffee and the General Assembly,” ABARI said.
“The new law also ensures that consumers receive the full value of their vehicle when it is lawfully determined a total loss; it requires insurers to value vehicles based upon publically available guides used in the automotive industry such as Kelly Blue Book and NADA. They are now prohibited from using their own cost-cutting programs that take advantage of those who do not have the means to fight such unfair claims practices,” ABARI added.
Insurers had campaigned against the bill with online and radio advertisements and the Property Casualty Insurers Association of America (PCI) said they were “profoundly disappointed” that the Governor approved the legislation. Frank O’Brien, VP for the Property Casualty Insurers Association of America (PCI) said, “By forcing vehicles that are badly damaged to be repaired rather than totaled, this law is designed to increase body shop revenues. But in the end it is the Rhode Island consumer who will pick up the tab. Over the years special interest groups such as ABARI have wielded significant influence in Providence and they have reaped the benefit of bill after bill being passed with the end result being repair costs growing at more than twice the national average and increased hassle and inconvenience for consumers. Unless someone provides a check and balance on body shop costs, this trend is likely to continue.
“We believe consumers, insurers and body shops should have the same goals - high quality repairs at reasonable costs. Although this new law falls short of the mark, the insurance industry remains committed to protecting the interests of consumers and putting safety first.”