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Monday, 15 July 2013 18:09

Maryland body shop owner wins short-pay lawsuit against GEICO on behalf of a customer

Mark Schaech, co-owner of Mark’s Body Shop of Baltimore, filed the suit against GEICO due to the insurer's refusal to pay $392.95 in repair costs on behalf of its policyholder. The underpayments included: degreasing vehicle prior to repair; feather, prime and block repaired panels; clean vehicle for delivery; clear OBD fault codes; reset electronics (recorded settings); mask for primer; and overhaul door handle for refinishing.

“We offer exceptional quality and service to our customers, and to continue to do so without being properly compensated is simply unreasonable and unsustainable," said Schaech. "While my father (partner) and I would rather avoid having to take such legal actions, something had to be done as the insurer’s efforts to underpay our customers continued to increase. I felt like that guy in the movie Network where he stuck his head out the window and yelled, 'I’m mad as hell and I’m not taking this anymore!'

“While Maryland does not allow the recovery of legal fees to the prevailing parties in such issues, we couldn’t allow that to be a deterrent in our being able to properly serve our customers and our employees. Insurers have continued cutting their costs while our costs for labor, materials and overhead have steadily increased. The only way we could survive was to either concede to the underpayments and cut our quality of materials and labor…or push back. We found short-pay litigation necessary to stop the insurer’s practice of underpaying our customers and to enable us to provide the quality repairs that earn our customers (and their referrals) for life."

Schaech credited a free legal seminar in Florida hosted by Barrett Smith of Auto Damage Experts, Ray Gunder of Gunder's Auto Center and Gunder's attorney, Brent Geohagan, with motivating him and giving him the information he needed to take action.

"That was a turning point for us. To hear Ray talk about how he knew that if he hadn’t done something he would be out of business struck a chord in me, and I knew then that I, too, needed to do something or we would lose our business," Schaech said. "Ray gave much credit to his success in having a great support team in Barrett as his consultant and Brent as his legal counsel.”

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