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Friday, 21 March 2014 18:51

Auto Body Bills in Rhode Island Draw Heavy Fire from Both Sides, Accusations of Lies

On March 18, 2014, three auto body bills were heard by the House Committee on Corporations that the Property Casualty Insurers Association of America (PCI) says should be defeated in Rhode Island to protect inherent rights as consumers, according to reports by Randal Edgar in the Providence Journal.

There were accusations of lies and counter-accusations of self-interest. There were numbers that suggest costs have risen dramatically, and other numbers that suggest they’ve been stable.

The 2014 clash mostly revolves around two bills, both supported by the Auto Body Association of Rhode Island (ABARI) and opposed by PCI.

House Bill 7404, sponsored by Representative Stephen Ucci, D-Johnston, expands a law that requires owner approval when aftermarket parts are used on vehicles that are less than 30 months old. Under current law, the rule applies to body parts, but Ucci’s bill would make it apply to all parts.

Supporters said the bill would protect owners and ensure that damaged parts on newer cars are replaced with parts from the car manufacturer.

But opponents said the change would affect even minor parts and could drive up repair costs.

House Bill 7796, sponsored by Representative Arthur Corvese, D-North Providence, establishes two tiers of auto-body repair shops: “Class A” shops that would be capable of repairing new cars with the latest technologies and materials, and “Class B” shops that would work on older cars.

Supporters said that the bill reflects changes that are coming with the use of new materials in the latest cars, and opponents did not dispute that idea. But they did oppose language in the bill that calls for different labor rate surveys for the two types of shops.

Stephen Zubiago, a lobbyist for PIC of Rhode Island, said the motivation is money.

“What this bill is aimed at is a labor rate,” he told the House Corporations Committee.

But James Moy, a senior consultant with Precision Auto Group in New York, disagreed.

“It’s not about charging more,” he said. “It’s about getting the car fixed.”

While the bills were the reason people came to testify, the recent history of auto body shop owners clashing with insurers made the two-and-a-half-hour meeting seem like the latest installment in a feud.

The PIC came into the meeting with a “Special Report” titled “It’s Time to End the ABARI Campaign.” The report was subtitled: “Stop Excessive Cost Hikes Caused by a Decade of Body Shop Legislation.”

The report says collision repair costs, body shop labor costs, collision claim costs, collision insurance premiums, and vehicle insurance premiums have all risen during the past decade— one in which the Auto Body Association of Rhode Island has supported 17 bills that have become law. The report also says Rhode Island had the 13th-highest average body shop collision repair cost in the nation 10 years ago and now has the second-highest.

PCI and other insurers are supporting a website campaign focused on legislation in Rhode Island and Maryland called ABARI in an attempt to sway consumers.

Jina Petrarca-Karampetsos, attorney spokeswoman for ABARI, responded with her own report that says average repair costs rose just two percent from 2004 to 2010. She also said that in 2011, the average premium for auto insurance in Rhode Island was US$1,148—“exactly 19 dollars more than your premium was in 1996.”

“I am so tired of coming up here with facts and figures and having to defend against lies,” she said.

Francis O’Brien, vice president of state government relations for the PIC, said he stood by the association’s report and “would be happy to provide the committee” with a rebuttal.

The committee held the bills for further study.

See related story about Peter Petrarca.

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