Thursday, 24 October 2013 18:58

Aluminum Repair Impasse Causes Oregon Shop Not to Renew Select Service Agreement

During a meeting with the area State Farm Estimatics Manager, Ron Reichen, President of Precision Body and Paint in Beaverton Oregon, chose not to re-negotiate his company’s Select Service agreement with State Farm Insurance, the nation’s largest personal auto insurer—a relationship which lasted over 17 years and of which accounted for $2 million dollars in business over the past year.

“It was actually a business decision we had been considering for some time” stated Reichen. “Discussions came to an impasse over fair and reasonable rates and allowances for aluminum repair.  Our terminating the Select Service agreement stems from our company being a certified Tesla repair facility and the investments in time, equipment, training, specialized equipment and facilities which we could not offer for the rates State Farm was willing to pay. This will no doubt enable our company to re-evaluate and revise our pricing on other goods and services for the other manufacturers of which we are a certified repairer for including Porsche, Audi, Volkswagen, Nissan, Volvo, GM, Chrysler and several others.”

Along with all other insurers, State Farm has paid Precision’s posted aluminum labor rates in the past. With Precision being the only certified Tesla repairer in the state, it is believed that with its growing popularity and its all aluminum construction, that State Farm has now elected to deny Precision’s aluminum rates under the Select Service Program.  As a result, like all other insurers, State Farm will no longer be provided the concessions (e.g. storage) Precision offered in the past.

Reichen stated: “While insurers continue to adjust their rates based upon economic pressures; as vehicle technology advances with new sophisticated metals, manufacturing and repair techniques, repairers, party to such programs as Select Service are precluded from keeping pace with their increasing costs. We found attempting to do so, while maintaining the highest level of quality and service, to be both unreasonable and unsustainable, and as a business decision we elected to resign from the insurer’s program.

“This was Precision’s last insurer Direct Repair relationship, and as in the past, we will continue to work with all insurers on our customer’s behalf. Precision is committed to its customers and our community and will continue to work diligently to serve them with the highest quality repairs and service in an expeditious manner regardless of which insurer is involved.”

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