LEGISLATIVE UPDATE

by Kevin Walli, AASP-MN Lobbyist

AASP-MN Digs in on Legislative Issues

As we pass the halfway mark of the 2021 session, AASP-MN finds itself working a handful of issues of interest or concern to members. Proposals to change the Minnesota Salvage Title statute are once again being debated in the House and Senate.

For the past several years, we have faced a proposal which would remove “late-model” and “high-value” as qualifiers for vehicles subject to salvage title – essentially making every vehicle totaled by an insurer a salvage title vehicle (regardless of age or value). This proposal has been successfully sold to the Senate Transportation Committee as a consumer protection provision – although it’s hard to measure what consumer benefit will actually occur as a result of this change.

AASP-MN does not support this revision, believing that members can and should be given every opportunity to properly repair and return these vehicles to the road. Nor do Auto Auctions or Legal Aid or even the Insurance Federation of Minnesota. In fact, these groups met together on several occasions in 2020-21 to develop an alternative proposal dealing with the Salvage Title statute. We were joined in this work by a Democrat and a Republican from the House of Representatives – Representative Cheryl Youakim (DFLHopkins) and Representative Eric Lucero (R-Dayton).

What emerged from this working group is a bill that is intended to provide consumers with information about the nature of the damage to the vehicle that resulted in it being designated for a Salvage Certificate of Title. The bill, House File 145, is authored by Representative Youakim and co-authored by Representative Lucero. The nature of damage to the vehicle would be identified as flood, hail, fire or collision.

We have met with the chair of the House Transportation Committee to advocate for Representative Youakim’s bill rather than the bill passed by the Senate Committee. We will be watching closely and will remain involved in the discussions relating to changes to the Salvage Title statute.

Additional bills that have been proposed deal with a growing problem across the state – the theft of catalytic converters for their precious metals. The general theme of the bills is to create greater accountability for scrap dealers and others who purchase the stolen catalytic converters. Penalties would be significantly enhanced for the purchase of catalytic converters unless the buyer complies with a number of new requirements to document the seller’s legitimate possession of the part.

For our part, we have been trying to spare repair shops additional burdens for handling and disposal of catalytic converters they come by during the course of normal repair and maintenance of customer vehicles. The idea is to develop language which would exempt shops from any additional recordkeeping requirements for disposal of these materials.

Finally, we have been engaged in discussions with the Insurance Federation of Minnesota on some claims practice changes. We do not expect them to result in legislative action this year, but the discussions will allow us to refine our arguments for use in future legislative sessions.

The first issue relates to parts procurement. Insurers routinely call for repair shops to purchase parts for the lowest price that can be found, regardless of the vendor’s location. There has been no consideration for the quality of parts or the delays and other difficulties that arise if the parts are not as advertised and need to be returned.

AASP-MN has been arguing that insurers should be required to pay a reasonable market price based on the parts available within a 150-mile radius of the shop, allowing shops the opportunity to work with local vendors that they have built a business relationship with over time. We have argued that this change would be beneficial to repair shops, consumers and insurers as it would reduce cycle time for vehicle repairs, which is in everyone’s interest.

This is a fight we will have to continue.

The other issue we have been examining is how to expedite the final claims settlement. The Insurance Federation has shown some movement on this front. We are working with them to develop some proposed language regarding the timeline for processing supplements so that the total cost of repairs can be agreed upon before the vehicle leaves the shop.

Committee deadlines preclude advancing this measure during the 2021 session, so we will have to wait for the legislature to reconvene in 2022 to move this issue forward.

We will continue working on all of these issues and will report progress at the Capitol in the next edition of AASPMN News.