Smaller auto body shops can be a key resource for the collision repair industry in spurring transparency in insurance estimates.
That was an underlying message trumpeted by Linden Wicklund, executive director of the Minnesota chapter of the Alliance of Automotive Service Providers (AASP-MN) during the group’s Collision Monthly Meetup on Nov. 21.
“Independent, smaller shops become a really big resource for the industry because they do know what their data looks like from the beginning, even if they don't have a written down, because they're touching it,” she said.
The most significant problem facing the collision industry -- particularly in the insurer-shop relationship -- is that repair businesses regularly delete data on initial insurance estimates, Wicklund said.
Larger multi-shop operations (MSOs) grapple with far more estimate and customer data than smaller mom-and-pops, so it’s easier for initial estimate information to get buried in these larger conglomerates’ data systems, Wicklund noted.
“That's never going to end up on the PowerPoint in the boardroom if it's not data that's tracked,” she said.
AASP-MN member shops have consistently flagged carriers’ estimates as illegitimately low. Paltry estimates can lead to drawn-out, tense negotiations on supplemental claims between insurers and shops aiming to recoup losses suspected in the initial estimate.
AASP-MN President Aaron Swanson recently presented the challenges that these protracted supplemental claim negotiations can thrust on collision customers to Minnesota State Sen. Matt Klein, a member of the Democratic-Farmer-Labor Party and chair of the Minnesota Senate Commerce and Consumer Protection Committee.
Swanson’s shop, LaMettry’s Collision & Glass, hosted Klein at its Inver Grove Heights, MN, location, where collision professionals explained that delays cause customers “rental stress” in addition to the fact that supplemental negotiations can often take as many as 10 days between each of many supplements, along with other issues.
“Some [insurance] companies don't even have a phone number on their estimate,” Swanson said during the AASP-MN meeting Nov. 21. “They want to use either a portal, or they'll use a portal, and a third party will do it by doing the estimates, like a Snapsheet. Some [shops] will hold the car. Some … won't hold the car. Some shops will make the customer pay and go to an arbitration. There's a lot of different processes.”
AASP-MN is working to propose an amendment to state law during the state’s next legislative session that would require vehicle insurance companies to respond to body shops’ supplemental claims inquiries within three days of submittal, and to require insurance companies to state in writing -- to shops and customers -- whether any denied repairs are safety-related.
Minnesota’s next legislative session starts Jan. 14.
AASP-MN is also working on language to implement a right to private action for insurance companies that violate Minnesota vehicle insurance laws, Wicklund said.
Specifically, AASP-MN is proposing that any private party could sue any insurance company or adjuster that violates Minnesota’s insurance statute for both personal damages and attorney fees, Wicklund added.
“The attorney’s fees being paid is huge because that's where the big expense comes in,” she said. “That's more expensive than just losing the car altogether.”
AASP-MN is working with a new lobbying firm that the organization hopes will give it greater insight and expertise into civil claims processes and consumer protection.
“We can have great laws all day long,” Wicklund said. “If there's no accountability, they aren't real.”
Brian Bradley