A recent agreement between collision technology company asTech and insurance giant GEICO seeks to standardize pricing of certain repair services. The deal, asTech contends, is designed to reduce friction surrounding reimbursement and facilitate transparent pricing practices. Some shop owners, however, are concerned they’ve been left out of the loop.
Craig Edmonds.
The decision from asTech to standardize pricing on some scans and calibrations, President Craig Edmonds told Autobody News, was driven by customer feedback. Some insurance companies, he said, only cover labor and diagnostic scans, and many shop customers were facing reimbursement challenges when it came to calibrations and OEM scans.
asTech tools provide clear direction to shops and insurance providers on when certain scans and calibrations are required, Edmonds said. The agreement with GEICO, he contended, helps facilitate the use of these products.
“Calibration pricing has been labeled the Wild Wild West,” he said. “asTech chose to lead and get out in front of this to help take the friction out of reimbursement for shops.”
Shops and Pricing
Edmonds characterized the pricing agreement as a way to work toward transparency and efficiency, but the industry response has been varied.
“The reaction has been mixed,” he said.
David Clark, CEO of Kendrick Paint & Body in Augusta, GA, has been vocal on the asTech setup before. The deal, he said, is problematic on several levels, one of them being that it essentially leaves shops out of the pricing decision.
David Clark.
“I think it's just an overreach or overstep for a vendor to make an agreement with an insurance carrier on pricing and not involve the shop at all when the shop's the one that's paying the bill,” he said, referencing the fact that shops have to buy repair materials and come up with pricing that makes sense for them regarding scans.
Clark pointed out the reduced rates in the GEICO agreement mean less money for shops and different rates for consumers who are not insured through GEICO.
Due to a confidentiality agreement with GEICO, asTech said it is not authorized to release numbers from the pricing agreement between the two organizations.
Scans and Self-Certification
asTech’s approach to OEM-compatible scans also seemed problematic for Clark. He pointed out the specificity of manufacturers and the fact they don’t all recognize or validate aftermarket software. asTech’s self-certification process regarding equivalency of OEM-compatible scans and OEM scans brings up issues, he said.
“I've personally experienced running a vehicle with an optional OE scan that's from asTech and then running the same vehicle with an OE scan, and they came up with different readings,” he said, specifying that he has used both the asTech GEN2 diagnostic tool, which does not have OEM-compatible capabilities, as well as the All-In-One device, which does.
Edmonds said asTech can provide OEM-level scans when necessary. The company owns more than 1,000 OEM tools and can complete OEM scans for customers who prefer them, he said. Its OEM-compatible scans are an option when asTech testing replicates OEM results for a given make, model and year, he said, and if asTech testing can’t replicate the OE result, asTech’s Rules Engine will indicate that an OEM scan is required.
The company does agree that independent testing of its Rules Engine has merit, and it’s a process asTech will continue to explore in 2025, Edmonds added.
Nevertheless, concerns remained for Clark regarding the company’s self-certification process for scans.
“We're not talking about unbolting a fender or unbolting a bumper. We're talking about software that operates the vehicle. No third party has come in and done the research validation on what they claimed the product could do,” he said. “They also have not publicly shared any of the research or data that they have to legitimize what they say. The only thing they have shared is that these studies were done on total loss vehicles in a salvage yard.”
Repair Costs and More Agreements
Clark also expressed concern for end consumers’ safety in the face of cost savings, saying OE compatible scans may not be providing correct information on how to repair vehicles.
“The concern is they continue to try to drive these prices down, but nobody's focusing on the safety aspect of everything,” he said.
If the focus is solely on price, then safety and correct processes will be altered, he asserted. Shops will begin to look for ways to cut corners to remain profitable.
“If that's the direction, then you're going to put more unsafe vehicles on the road and consumers at risk,” he said.
The cost of repairing cars, he pointed out, is not decreasing.
“There's this race to the bottom for some reason,” he said. “Obviously, everybody's trying to bring down the cost of severity. Unfortunately, it just costs more to fix cars today than it did 10 years ago. I think studies are showing that accidents are down. I think the ADAS systems are doing their job of helping to mitigate those losses, but the cost once a vehicle is in an accident is a lot higher.”
Despite doubts from repairers like Clark, it seems agreements like the one between asTech and GEICO are becoming more common. According to Repairer Driven News, GEICO has expanded its pricing agreement to Protech Automotive Solutions.
Edmonds said asTech has no similar deals with other insurers in place, but the company will evaluate options on a case-by-case basis in the future. If asTech chooses to pursue testing with other carriers, he said, it will likely focus on leveraging its adasThink calibration tool.
“We will always look for opportunities that we believe will reduce reimbursement friction for our customers,” he said.
Elizabeth Crumbly