Friday, 18 July 2008 17:17

California Assembly Passes Anti-Capping Measure

The California Assembly unanimously passed California Senate Bill 1371 - the fifth version of the bill - that prohibits insurance companies from placing caps on payouts for collision repairs. The problem for the past two years has been that lawmakers cannot agree on a definition of capping.

The latest definition of capping, which was approved July 14 by the State Assembly, is "... offering or paying an amount that is unrelated to a methodology used in determining paint and materials charges that is accepted by automobile repair shops and insurers." The methodologies, which must be accepted by both automobile repair shops and insurance companies, are determined by multiplying the cost of paint and other materials by the refinishing rate.

Although the California State Assembly has approved this latest version, it must now be passed by the Senate.

Some states have paint capping regulations that are clear but there are many states that either don't address the paint cap issue or have vague statutory language. Virginia collision repairers were successful in acquiring the most recent paint cap law.

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