New England Automotive Report February 2020

ZEROING IN ON KEY OBJECTIVES: AASP/MA Launches Board Committees

NORTHEAST® 2020 Preview CAR Performance Standards: A Closer Look A Year for Changes

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2 February 2020

New England Automotive Report

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CITY SIDE SUBARU 790 Pleasant Street Belmont, MA. 02478 Phone Number: 617-826-5013 FAX Number: 617-489-0733

COLONIAL FORD OF PLYMOUTH 11 Pilgrim Hill Road Plymouth, MA. 02360 Phone Number: 800-233-8109 FAX Number: 508-830-1658

NORTH END SUBARU 757 Chase Road (Rte. 13) Lunenburg, MA. 01462 Phone Number: 877-289-0053 FAX Number: 978-582-9843

COLONIAL CHRYSLER JEEP DODGE-RAM 24 Coolidge Street (Rte. 62) Hudson, MA. 01749 Phone Number: 978-568-8000 FAX Number: 978-562-1213

COLONIAL FORD OF MARLBOROUGH 428 Maple Street Marlborough, MA. 01752 Phone Number: 888-460-1125 FAX Number: 508-460-3464

COLONIAL SOUTH CHRYSLER JEEP DODGE-RAM 42 State Road (Rte. 6) Dartmouth, MA. 02747 Phone Number: 508-984-1900 FAX Number: 508-996-5801

COLONIAL CADILLAC 201 Cambridge Road Woburn, MA. 01801 Phone Number: 781-935-7009 FAX Number: 781-933-7728

NORTH END MAZDA 757 Chase Road Lunenburg, MA. 01462 Phone Number: 800-322-1241 FAX Number: 978-582-9841

COLONIAL VOLKSWAGEN COLONIAL SOUTH CHEVROLET 89 Turnpike Road (Rte. 9) 361 State Road (Rte. 6) Westborough, MA. 01581 Dartmouth, MA. 02747 Phone Number: 888-322-6570 Phone Number: 508-996-6266 FAX Number: 508-616-0445 FAX Number: 508-979-1219 COLONIAL VOLKSWAGEN OF MEDFORD 162 Mystic Avenue Medford, MA. 02155 Phone Number: 781-475-5200 FAX Number: 781-391-3506

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February 2020 • Volume 18, No. 2

DEPARTMENTS

CONTENTS FEATURES

PRESIDENT’S MESSAGE By Molly Brodeur 8 | We’re Off and Running

EXECUTIVE DIRECTOR’S MESSAGE

By Evangelos “Lucky” Papageorg

12 | 2020: A Year for Changes

VENDOR AFFINITY PROGRAM MEMBER SPOTLIGHT

By Alana Bonillo

20 | Long Automotive

LOCAL NEWS 26 | Remembering Vinnie DelVecchio

NATIONAL NEWS 28 | AASP/MA, Vendors and More Prep for NORTHEAST® 2020

By Alana Bonillo

38 | COVER STORY By Joel Gausten

Industry Advice: Ask Mike 32 | What Did You Learn from the Australian Collision Industry?

Zeroing in on Key Objectives: AASP/MA Launches Board Committees

ALSO THIS ISSUE

42 | LEGAL PERSPECTIVE

6 | AASP/MA MEMBERSHIP APPLICATION 16 | AASP/MA VENDOR AFFINITY PROGRAM SPONSORS 13 | WHERE’S LUCKY? AASP/MA CHAPTER MEETING SCHEDULE

ADVERTISERS’ INDEX Accudraft Paint Booths ................................OBC AkzoNobel ....................................................31 American Honda ..............................................

14Audi Group ................................................37 BASF ............................................................17 Best Chevrolet/Best CDJR ..............................IFC BMW Group ..........................................................24 BMW/Mini of Warwick ..................................35 Boch Chevrolet ........................................27, 46 Boch Hyundai ................................................27 Colonial Auto Group ........................................4 Empire Auto Parts ..........................................23

By James Castleman, Esq.

CAR Performance Standards: The Other Side of the Coin

Ford Group....................................................36 Genesis of Norwood ......................................46 Honda Group ................................................45 Hyundai Group ..............................................11 Ira Subaru ......................................................11 Ira Toyota of Danvers ......................................10 Kelly Automotive Group ................................IBC Kia Group ......................................................11 Linder’s, Inc. ................................................27 Long Automotive Group ..................................21 Mazda Group ................................................34 McGovern Chrysler Jeep Dodge Ram ................26 Mopar Group ................................................19 Nissan Group ................................................40

PPG................................................................3 Quirk Wholesale Parts ......................................9 Reliable Automotive Equipment ........................7 Sarat Ford Lincoln..........................................46 Sherwin Williams ..........................................15 Spanesi ........................................................44 Subaru Group ................................................18 Toyota Group ................................................29 Volvo Group ..................................................22 VW Group ....................................................41 Wellesley Toyota/Scion ..................................35 Wheel Collision Center....................................23

New England Automotive Report February 2020 5

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6 February 2020

New England Automotive Report

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Start Fixing “The Right Way”

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PRESIDENT’S MESSAGE

responses to reflect your current changes in your costs of doing business. If you have not yet taken the survey, do so today by visiting laborratesurvey.com.

Chapter meetings have returned in 2020, with each zone meeting every other month. Last month, we brought repairers together in the Western and Southeastern zones to meet and learn about the latest news and industry trends. This month, we are doing the same in the Northeast and Midstate regions. Many engaging speakers and timely topics will be covered at these meetings throughout the year.

Perhaps the most important aspect of these meetings is the sense of community they bring to industry members. These bi-monthly gatherings allow member and non-member shops the chance to interact and share ideas and issues. The more we know, the better the chance we have at improving our businesses.

Looking ahead toward our larger regional event schedule, stay tuned for information on many exciting events to come along throughout the year. These include our annual Spring Meeting planned for late April, our annual Golf Outing in June and our annual General Membership Meeting planned for the fall.

If you have yet to renew your membership for 2020 or are not currently a member, contact the AASP/MA administrative office today. I’ve said it before and I’ll say it again, as many times as needed: All for one and one for all!

We’re Off and Running MOLLY BRODEUR

We are just a few weeks into the new year, and already there is such a strong feeling of positive energy and a surge of enthusiasm building within the collision repair community for a fruitful 2020.

AASP/MA has hit the ground running and is working hard to continue the great momentum we started in 2019. As the only association in Massachusetts working on your behalf, we are all about working hard to help YOU. This is especially why participation and support from collision repairers around the state is so important in helping us go even further.

We saw much of this in 2019. We took a strong stand towards combating Massachusetts’ most troubling issue: Being paid at the lowest Labor Rate in the nation. Through these efforts, we saw strength in numbers as hundreds of shops spoke out via our Labor Rate Survey. Many more have taken things even further by subscribing to BillableGenie. We saw change begin to happen with a few insurance companies adopting small hourly rate increases. It’s proof that things are going in the right direction and a sign that positive change is on the horizon.

We encourage all members to update their survey N

E

W

E

N

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

AASP/MA PRESIDENT MOLLY BRODEUR is the chief operating officer of Al Brodeur’s Auto Body in Marlborough, MA. She can be reached at (508) 485-1082 or molly@albrodeur.com G

L

A

N

D

AUT M TIVE AASP/MA EXECUTIVE COMMITTEE

STAFF PUBLISHER

GRAPHIC DESIGNER

Thomas Greco - thomas@grecopublishing.com

Lisa M. Cuthbert - lisa@grecopublishing.com

SALES DIRECTOR

EDITORIAL/CREATIVE COORDINATOR

Alicia Figurelli - alicia@grecopublishing.com

Alana Bonillo - alana@grecopublishing.com

EDITORIAL DIRECTOR

PRODUCTION

Joel Gausten - joel@grecopublishing.com

Donna Greco - donna@grecopublishing.com

TREASURER Matthew Ciaschini

PRESIDENT Molly Brodeur VICE PRESIDENT Kevin Gallerani SECRETARY Gary Cloutier

IMMEDIATE PAST PRESIDENT Paul Hendricks

AASP/MA STATEWIDE DIRECTORS PUBLISHED BY: Thomas Greco Publishing, Inc. 244 Chestnut Street, Suite 202, Nutley, NJ 07110 Corporate: (973) 667-6922 / FAX: (973) 235-1963 www.grecopublishing.com

COLLISION DIRECTOR Rob DelGallo

AT-LARGE DIRECTOR Adam Ioakim

AASP/MA DIRECTORS Ray Belsito Alex Falzone Rick Fleming

Joshua Fuller Kevin Kyes Frank Patterson

Mike Penacho Dana Snowdale Bill Spellane

AASP/MA ADMINISTRATIVE OFFICE -New England Automotive Report is published monthly by TGP, Inc., 244 Chestnut Street, Suite 202 Nutley, NJ 07110. Distributed free to qualified recipients; $48 to all others. Additional copies of New England Automotive Report are available at $5 per copy. Reproduction of any portions of this publication is specifically prohibited without written permission of the publisher. The opinions and ideas appearing in this magazine are not necessarily representations of TGP Inc. or of AASP/MA. Copyright © 2020 by Thomas Greco Publishing, Inc. Images courtesy of www.istockphoto.com

WWW.AASPMA.ORG 8 February 2020

New England Automotive Report

Evangelos “Lucky” Papageorg: AASP/MA Executive Director

Alana Bonillo: AASP/MA Administrative Assistant P.O. Box 212 Marlborough, MA 01752 617-574-0741

10 February 2020

New England Automotive Report

Make Quality Your Goal.

REPAIR WITH KIA GENUINE PARTS. Your reputation depends on repairs done right - the first time. Kia Genuine Parts are manufactured to the same exacting standards as original equipment. Don't take chances by using aftermarket parts. Are you willing to risk your reputation and customer satisfaction? A happy customer is your best advertisement.

Protect your customer, protect your business Insist on Kia Genuine Parts.

Contact these select dealers for assistance and delivery of your Kia Genuine Parts.

Bald Hill Kia 1021 Bald Hill Road Warwick, RI 02886 Parts Direct: (800) 822-3015 www.baldhillkia.com

Quirk Auto Dealers 115 E. Howard St. Quincy, MA 02169 Toll Free: (877) 707-8475

HYUNDAI IS PROUD OF ITS REPUTATION FOR QUALITY AND SERVICE. SO ARE THE DEALERS AND BODY SHOPS WHO RELY ON GENUINE HYUNDAI PARTS. TO MAKE CERTAIN THAT YOU GET THE RIGHT HYUNDAI PART, ASK FOR A HYUNDAI WHOLESALE PARTS SPECIALIST.

For Genuine Hyundai parts, contact an Authorized Hyundai Dealer.

HERB CHAMBERS HYUNDAI 735 Southbridge Street Auburn, MA 01501 TOLL FREE: 800-767-1898 FAX: 508-832-6026 EMAIL: pobrien@herbchambers.com www.herbchambershyundaiofauburn.com

BOCH HYUNDAI 391 Boston Providence Hwy Route 1, The Automile Norwood, MA 02062 PARTS LINE: 781-762-9210 TOLL FREE: 800-559-9210 bchwholesale@boch.com

New England Automotive Report February 2020 11

EXECUTIVE DIRECTOR’S MESSAGE

: EVANGELOS “LUCKY” PAPAGEORG

We are already a month into the new year, and I am very excited about the potential and opportunity for significant change. The foundation for much of this was laid during 2019. Now is the time to build upon that strong foundation and work together to effect much-needed changes in how business is conducted in the collision repair industry. Much of these changes will have drastic effects on our numbers.

When I say “numbers,” I am not only referring to the financial numbers, which mean so much to our businesses and our survival. I’m also referring to the number of shops that will survive the onslaught of changing technology. Sadly, there are those who have ignored the warnings and advice given by individuals, consultants and associations like AASP/MA and the Society of Collision Repair Specialists (SCRS). Despite our best efforts, these same businesses have fallen so far behind that I fear it may be nearly impossible for them to catch up. AASP/MA will continue to provide the support and information required to shop owners and their businesses to stay current and “get ahead of the curve” regarding changes in repair technology and the equipment required to perform proper repairs on today’s vehicles.

We will also strive to make the AASP/MA brand one that is familiar to the motoring public as the only entity whose goal is to “protect consumers and the collision industry.”

During 2019, AASP/MA successfully launched an independent Labor Rate Survey that saw a “statistically bulletproof” level of response reached in the unprecedented shortest time frame ever experienced by National AutoBody Research (NABR). There is no doubt

12 February 2020

New England Automotive Report

A Year for

CHANGES

that this is a direct reflection of Massachusetts’ lowest Labor Rate in the country and the frustration of our industry dealing with this low amount. We continue to gather the critical documentation reflecting posted Labor Rates, which are the true indicator of the prevailing rate in Massachusetts.

We are also collecting important documentation of what insurers are paying here and across the country through the Variable Rate System (VRS) Survey and the added “BillableGenie” feature. Hundreds of documents from Massachusetts have been added to the thousands previously collected nationally. Massachusetts shops have been using the documentation to successfully substantiate repair procedures and their needed reimbursement amounts.

Subscribe to BillableGenie and use this important tool. Many shops in Massachusetts have already realized the benefit. With each upload and exchange of information, the BillableGenie becomes a more powerful tool. If you have taken the VRS Survey in the past, please consider updating your responses to reflect any changes in your rates or certifications. For the Labor Rate to change, the survey must be reflective of the current information of your posted rate.

At the November AASP/MA Board of Directors meeting, several important committees were established. Working together, these committees will help to strengthen the AASP/MA brand and address issues that will benefit our membership. The Labor Rate and BillableGenie Committee will continue its efforts. In addition, the Membership/Marketing Committee will work to strengthen our membership numbers and take our

message to the consumers of Massachusetts through the many informational platforms available.

Discussing, learning and documenting the requirements and procedures necessary to restore today’s vehicle back to roadworthy specifications is of utmost importance. Information is important to ALL those in the repair process. The vehicle owner, the repairer and the insurer must know their role, relationship, responsibility and liability in the process.

As always, our Legislative and ADALB Committee will not only work to promote new legislation and regulations for the benefit of consumers and repairers, but it will also be our vigilant watchdog to ensure that no adverse legislation or regulations are forced into place that would be detrimental to consumers and our industry. As part of that process, we have already held several meetings with legislators on a one-on-one basis. The most successful meetings have taken place in repair shops, where the legislators get to see firsthand what is involved in the collision repair process. They see the training certifications and equipment that must be purchased and maintained to perform required repair procedures to OEM specifications. These shop meetings with legislators are an integral component to getting our message out to those who can help. If you have a relationship with your local legislator and would like to coordinate a visit, please contact our office; we will work together with you and your shop to coordinate our efforts for the best possible results. If you do not have a relationship, this is a great way to establish one. It is very easy, as you are in your comfort zone and have all at your disposal to

make and get your point across. I am here, along with other AASP/MA representatives, to help and be present to assist.

We also have the new Vendor Affinity Program (VAP) and Events Committees. These two committees play important roles to help guarantee the financial success of AASP/MA, which allows us the ability to broaden our support base through legal counsel and lobbying. VAP is a system by which vendors are able to show additional support of AASP/MA’s efforts over and above membership. The vendors that participate pay a premium based on a “step” level of support, with each “step” having different benefits of exposure to our membership. Our only request is that you support those vendors that go over and above through their support of the program.

Our Events Committee is focused on three major events this year: Two general membership meetings and our fundraising Golf Tournament. Building upon our very successful General Membership Meeting at the end of September 2019, we will hold a spring meeting in April 2020. Our featured guest speaker will be Aaron Schulenburg, executive director of SCRS. Aaron will bring us up to date on important national issues, such as the effort to save and strengthen the 1963 Consent Decree. He will also demonstrate SCRS’ new Guide to Complete Repair

Planning - Blueprint Optimization Tool (BOT), which was named the Best New Collision Repair and Refinish Product at the 2019 SEMA Show.

AASP/MA will hold two chapter meetings per month to bring you current information and to hear from you – our members. Several of these meetings will also be used as membership recruitment events where we encourage members to bring along non-members. The more shops who hear our messages and efforts, the stronger our voice becomes. The shops that are not or have not been members of AASP/MA don’t even know what they don’t know. Your best ally is your colleague down the street, but if they don’t know how to perform proper repairs and be reimbursed properly for doing so, then they are your worst enemy and only serve to hold you back.

AASP/MA is the only vehicle to get the needed information to those who need it most and ensure that everyone knows their role and responsibilities in the repair process.

Stay tuned and stay involved, as 2020 is going to be filled with more positive changes!

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

AASP/MA EXECUTIVE DIRECTOR EVANGELOS “LUCKY” PAPAGEORG can be reached at (617) 574-0741 or lucky@aaspma.org

Where’s Lucky?

AASP/MA Chapter Meeting Schedule Visiting Boston/Southeast

In the first week of February, Lucky will be visiting shops in the Boston/Southeast region.

During the second week of February, he will be in the Midstate region and will be hosting a chapter meeting on February 12. (Location TBD)

M Visiting Midstate

Visiting Western

M

In the third week of February, he will be visiting the Western region.

Visiting Boston/Northeast

He will be visiting shops in the Boston/Northeast region in the fourth week of February and will be hosting a chapter meeting on the 26th. (Location TBD.) In the first week of March, Lucky will be visiting shops in the Midstate region.

During the second week of March, he will be in the Boston/Southeast region and hosting a chapter meeting on the 11th. (Location TBD.) In the third week of March, he will be visiting the Boston/Northeast region.

Visiting Midstate

M Visiting Boston/Southeast

He will be visiting shops in the Western region in the fourth week of March and hosting a chapter meeting on the 25th. (Location TBD.)

Visiting Boston/Northeast

M

*Subject to change. Everyone should keep an eye out for meeting notices in their area.

Visiting Western

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

Lucky can be reached at (617) 574-0741 or lucky@aaspma.org.

MASSACHUSETTS

New England Automotive Report February 2020 13

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18 February 2020

New England Automotive Report

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BEST CHRYSLER DODGE JEEP RAM 520 Colony Place Road Plymouth, MA 02360 Order Hotline: (800) 932-7900 Fax: (781) 749-7804 www.bestjeep.com IMPERIAL CHRYSLER DODGE JEEP 6 Uxbridge Road Mendon, MA 01756 Order Hotline: (877) 272-0332 Call us for your wholesale parts needs!

MCGOVERN CHRYSLER JEEP DODGE RAM 777 Washington Street Newton, MA 02460 Order Hotline: (800) 741-7563 www.clarkandwhiteautos.com For the best customer service ask for Mando Bogosian PREMIER CAPE COD 460 Yarmouth Road Hyannis, MA 02601 Order Hotline: (888) 927-8261 Fax: (508) 778-0900 www.premiercapecod.com QUIRK AUTO DEALERS 115 E. Howard Street Quincy, MA 02169 Order Hotline: (877) 707-8475

KELLY JEEP CHRYSLER 353 Broadway Route 1 North Lynnfield, MA 01940 Order Hotline: (800) 278-8558 Fax: (781) 581-2490 Email: kjcparts@kellyauto.com Over $1,000,000 in stock to support your business, and fast free delivery!

Check out MoparRepairConnection.com for resources, promotions and technical information. ©2019 FCA US LLC. All Rights Reserved. Chrysler, Dodge, Jeep, Ram, Mopar and SRT are registered trademarks of FCA US LLC.

New England Automotive Report February 2020 19 1:30 PM

[VENDOR AFFINITY PROGRAM MEMBER] SPOTLIGHT By Alana Bonillo

Long Automotive In a competitive market, Long Automotive has built quite the reputation as a reliable one-stop location for genuine GM and Subaru auto parts and dependable care.

“Our main focus is customer service; it’s not just all about discounts,” states Parts Manager Tom Schube. “We keep a very large inventory – over $2 million. We don’t believe in working out of the manufacturers’ warehouse and having parts shipped the next day. We have the parts on the shelf for same-day delivery. If a customer calls at 8am with a $4,000 parts order, we are able to ship it out to them that same day. We surprise customers when our drivers show up. [They say,] ‘Wow, I just called that in an hour ago!’ I think that’s where we really made our splash –through inventory and customer service.”

Tom has been managing the parts department since 1996. He took over for his father, Fred, who managed the department for more than 37 years. The elder Schube started with Long Automotive in 1959 as a driver and worked his way into management. A few years later, he took the reins in getting the wholesale parts department started, for which he managed to build a very successful business model.

Long’s parts operation began with only one truck and grew from there. Today, they have a truck fleet of 19 and recently added 12,000 square feet to the existing warehouse. In addition to allowing more room for inventory, the expansion increased efficiency, as they can now operate with one door for shipping and another for receiving.

Like his father, Tom also got his start with the company behind the wheel as a driver. He worked his way into shipping, receiving and later wholesale. When Fred decided to go into semi-retirement, dealership owner Charles Long decided that Tom should to take over as manager – and off to GM college he went. “[My father] started the whole thing. All I’ve done is add to it and perfect it a bit,” he says.

Fred stayed on behind the scenes and still comes in every day. Tom refers to his 80-year-old father as the “Energizer Bunny,” as he just won’t stop. There are 97 years of experience between the father-and-son team.

Schube credits much of the department’s success to an excellent team that includes several Long Automotive veterans. Among that notable crew is Kenny Parker, assistant manager of wholesale parts (41 years), and wholesale advisory team members Tim Leroy (27 years), Al Chamberlain (23 years), Ed Poor (22 years), Mike Gentile (21 years) and James “Mac” McClallen (14 years). Another

Left to right: Ken Parker, Tim Leroy, Al Chamberlain, Mike Gentile, James “Mac” McClallen, Ed Poor, Skye Mazuroski, Ray Antinovitch and Sean Mahoney

team member of note is Skye Mazuroski, who has been with the company for the past 10 years and has the skill and expertise to step into any role as needed. The recent expansion led to the addition of Ray Antinovitch (one year) and Sean Mahoney (three months) to the wholesale call center.

“They are experts in what they do; without them, we wouldn’t be as successful,” Tom says of the wholesale advisory team. “Customers like the feeling that they will be taken care of when they call here.”

The parts department follows up on every order that comes in, and they have an excellent delivery system.

Every truck is equipped with GPS, so they are able to communicate to the customers when they can expect their parts right down to the very minute. They truly understand the needs of their customers and make sure to not have their trucks out late in the day.

As a parts supplier with a footprint across most of Massachusetts, Rhode Island and part of Connecticut, Long Automotive knows that it’s important to be involved with the local auto community. They have been a supporter of AASP/MA for a number of years and currently serve as a Vendor Affinity Program Silver Sponsor.

Looking ahead, Tom definitely sees more growth on the horizon and is committed to taking a strategic approach to ensure his operation always has the right resources in order to take on new customers.

“You don’t want to promise them what you can’t give. You only get one chance to make a first impression.”

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

20 February 2020

New England Automotive Report

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New England Automotive Report February 2020 21

Quality Repairs Start With Volvo Genuine Parts.

For over eight decades, the Volvo name has been synonymous with unmatched quality and performance. That legendary Volvo quality starts with Volvo Genuine Parts.

Rely on Volvo Genuine parts to get the right fit, at the right price, right now.

Please contact the following dealers for your Volvo parts needs:

Prime Volvo Cars 1030 Hingham Street Rockland, MA 02370 Parts Direct: 781-927-3520 Fax: 781-927-3592 www.volvocarssouthshore.com

22 February 2020

New England Automotive Report

Volvo of Wellesley 962 Worcester Street Wellesley, MA 02482 Parts Direct: 800-247-3033 Fax: 508-651-1220 www.volvoofwellesley.com

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1.800.292.RIMS (7467) New England Automotive Report February 2020 23

THEY’RE CALLED “ORIGINAL BMW PARTS” FOR GOOD REASON. FOR UNCOMPROMISING PRECISION AND INCOMPARABLE QUALITY, YOUR BMW CENTER IS YOUR ONE-STOP SHOP FOR EVERYTHING BMW. For Original BMW Parts, contact one of these authorized BMW centers: BMW of West Springfield 1712 Riverdale St. West Springfield, MA 01089 PH: 413-746-1722 FAX: 413-304-9009 bmwwestspringfield.com

BMW of Stratham 71 Portsmouth Avenue Stratham, NH 03885 PH: 603-772-0000 FAX: 603-772-9436 bmwofstratham.com

Tulley BMW of Nashua 147 Daniel Webster Hwy Nashua NH 03060 PH: 603-888-5050 FAX: 603-888-8427 tulleybmw.com

New Country BMW 1 Weston Park Ave. Hartford, CT 06120 PH: 860-240-7881 FAX: 860-240-7873 newcountrybmw.com

BMW of Warwick 1515 Bald Hill Rd. Warwick, RI 02886 PH: 401-821-1510 FAX: 401-823-0530 bmwofwarwick.com

BMW of Sudbury Wholesale Parts 68 Old County Road Sudbury, MA 01776 PH: 800-338-3198 FAX: 508-881-7578 bmwofsudbury.com

©2020 BMW of North America, LLC. The BMW name, model names and logo are registered trademarks.

24 February 2020

New England Automotive Report

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[LOCAL] NEWS

Remembering Vinnie DelVecchio member of the Massachusetts Auto Body Association (MABA), Vinnie was the well-known owner and operator of The Body Smith Shop in Quincy for 57 years. Today, the shop is owned by his son, Vincent, who has carried on the family business’ active industry involvement through his membership in AASP/MA. Born in Quincy, DelVecchio was an avid New England Patriots fan and enjoyed gardening and working around his home. Above all, he loved family gatherings, Sunday dinners and supporting the activities and accomplishments of his many muchloved grandchildren and great-grandchildren.

DelVecchio is survived by his beloved wife of 63 years, Ethel D.

In late November, the Massachusetts automotive community lost one of its strongest friends and allies with the passing of Vincent J. “Vinnie” DelVecchio at the age of 87. A former

“Bitsy” (McPhail) DelVecchio; son Vincent; daughters Donna L. Velez, Dianne M. DePietro and Lisa A. Bowen; 14 grandchildren; three great-grandchildren; and brothers Alfred and Leo. He was pre-deceased by his sister, Josephine Puglisi, and his brother Mario. He is also survived by many nieces and nephews.

Donations in DelVecchio’s memory may be made to the March of Dimes Donation Processing Center, P.O. Box 18819, Atlanta, GA 31126 or the American Heart Association, 300 5th Ave., Suite G, Waltham, MA 02451-8750.

AASP/MA and New England Automotive Report offer his family and friends our deepest condolences.

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

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Call us and get the right MOPAR parts the FIRST TIME! 26 February 2020

New England Automotive Report

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New England Automotive Report February 2020 27

[NATIONAL] NEWS By Alana Bonillo

AASP/MA, Vendors and More Prep for

2020

The NORTHEAST® Automotive Services Show, the biggest automotive industry event on this side of the country, returns next month!

Year after year, collision repair professionals from the New England area and all over the US make the trip to the Meadowlands Exposition Center in Secaucus, NJ to experience NORTHEAST, which offers the very best in products, training and education. Hosted by the Alliance of Automotive Service Providers of New Jersey (AASP/NJ), the show will take place March 20-22.

“NORTHEAST is a great venue to get a preview of what changes are coming in the future,” suggests AASP/MA Executive 28 February 2020

New England Automotive Report

Director Evangelos “Lucky” Papageorg. “It is a great location where it is easy to see a lot of vendors in an easily covered area in the course of a day, if that is all the time you can afford. The show is easily reached from Massachusetts. It is a great way to meet and network with folks from our region and on a national level as well. The show has improved on itself each and every year, and I look forward to seeing what is in store at NORTHEAST 2020 this March.”

Various companies from different parts of the US travel to New Jersey to demonstrate and debut new products at NORTHEAST. “We really find it very worthwhile,” shares Melly Bonita,

The NORTHEAST Automotive Services Show, MARCH 2019 director of sales and marketing for MyShop Traffic, which sells software for body shops. After a very successful debut at NORTHEAST 2019, the New Hampshire-based company returns for the 2020 show.

“The quality of attendees is really sharp. The body shop owners and managers are our key customers, and they were there looking to make business decisions. Many made them right on the spot. That was nice compared to other shows, where many just browse and aren’t the right target for us. The NORTHEAST audience is top-notch.”

Another regular NORTHEAST supporter is SherwinWilliams, returning this year as a General Sponsor. The company will be promoting its refinish systems and House of Kolor custom paint brand. Attendees can expect to see celebrity painters including Ryan Evans, Mike Henry (Horny Mike) and Lonny Speer, along with NUB Grafix and other special guests.

“The NORTHEAST show continues to grow, and we’ve been seeing shows in other market areas continue to dwindle,” states Tim Morgan, chief operating officer at Spanesi Americas.

“There is always great attendance at NORTHEAST, and it’s a great selling show for us. We are glad to be a part of it; it’s a show that I have been participating in since 1997.”

NORTHEAST will once again provide attendees with national-level educational opportunities and training. For a third year, AASP/NJ has partnered with the Washington Metropolitan Auto Body Association (WMABA) to present the Collision

Professional Repairer Education Program (Collision P.R.E.P.) at NORTHEAST 2020.

“Every year, WMABA aims to bring the most relevant and timely education available to the NORTHEAST show for all participants coming from near and far,” comments WMABA Executive Director Jordan Hendler. “We want to cover a variety of subjects that pertain to each key employee type in the repair shop – from front office to technician to owner. Not only is NORTHEAST the premier education event for the entire East Coast as far as learning a lot in a short time, but it is also a great place to make new industry acquaintances who can strengthen your peer group. It’s important to revitalize your mind with the latest in technologies, processes and how to maintain that culture throughout the year.”

If you haven’t made your travel plans yet for the most exciting automotive weekend of the year, now is the time to do so.

AASP/NJ has made arrangements with a number of hotels in the area, many of which are just steps away from the Exposition Center. You can also pre-register now for your attendee badge for FREE. Learn more by visiting aaspnjnortheast.com.

“Register now. It is the largest show of its kind and it is right in your own backyard,” suggests AASP/NJ President Jerry McNee. “NORTHEAST is jam-packed with all the relevant products, training and information you can’t get anywhere else. It’s the best bang for your buck.”

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

New England Automotive Report February 2020 29

WHY GENUINE PARTS? It’s the Right Thing to Do

You lose money when aftermarket parts don’t fit. Toyota Dealers are your best source for Genuine Toyota Parts. All it takes is one call.

For Toyota Genuine Parts please call one of these authorized local Toyota Dealers: IRA Toyota of Manchester 33 Auto Center Road Manchester, NH 03103 Toll Free: 800-828-6076 Direct: 603-657-2410 Fax: 603-657-2419

IRA Toyota Danvers 161 Andover Street Danvers, MA 01923 PH: 800-774-8411 ext.1 Direct: 978-739-8306 FAX: 978-739-8098

stirrell@iramotorgroup.com www.iramotorgroup.com

www.iramotorgroup.com

Bernardi Toyota 1626 Worcester Road Framingham, MA 01702 Parts Direct: 800-248-3033 FAX: 508-879-7895 www.bernarditoyota.com

Wellesley Toyota 216 Worcester Street Wellesley, MA 02481 PH: 800-734-0006 Direct: 781-237-4042 FAX: 781-237-3481 parts@wellesleytoyota.com www.wellesleytoyota.com

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

ToyotaPartsAndService.com 30 February 2020

New England Automotive Report

Reduce cycle c time by an average of 9% in your body sho h p ÂŽ

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New England Automotive Report February 2020 31

[INDUSTRY] ADVICE

ASK MIKE

What Did You Learn from the Australian Collision Industry?

This month, we “ASK MIKE” to share some thoughts on his recent visit with shops and industry professionals in Australia. We at New England Automotive Report hope you find this following exchange useful, and we encourage you to reach out to us if you have a question for Mike on this or any industry-related matter that he can answer in a subsequent issue.

New England Automotive Report: Mike, you recently spent time with collision repairers in Australia. How does their industry compare to ours back home?

Mike Anderson: First of all, I’m very appreciative of everyone who enabled me to make this trip. [CIC Administrator] Jeff Hendler opened the door for me to have the opportunity to go there. Also, Barry Dorn [Society of Collision Repair Specialists/Washington Metropolitan Auto Body Association] and Aaron Clark [then of Assured Performance Network] flew there as well, and I appreciate their friendship and support with that. I really didn’t know a lot about the Australian market before I went there. I tried to do as much research as I could, and I even talked to shop owners and managers before I went there.

I did some work for an organization called Capricorn, which is a co-op of about 1,800 shops in Australia and New Zealand. Then, I did some work for Axalta while I was there. Obviously, things are a bit different in Australia than they are in the US. For example, they call a hood a ‘bonnet,’ and they call a roof a ‘turret.’ We call it a ‘deductible;’ they call it an ‘excess.’ They call insurance estimators ‘assessors.’

At the end of the day, I tried to focus my talk on technical aspects of fixing cars. Fixing a vehicle in Australia might have a different repair procedure than in another country based on what that country’s standards were

32 February 2020

New England Automotive Report

when they built those vehicles. I did my research, and I found out that the way we have to fix cars as per the OEM repair procedures in the US is the same exact way in Australia. I do believe that in Australia, they are not as advanced and knowledgeable as we are in regard to scanning and calibrations. I don’t mean that disrespectfully, but it seemed like that is a very new advancement for them. I tried to educate them on scanning, calibrations and some of the technical things I’m privy to thanks to my new opportunity to work with OEMs in the US. One thing I found out is that Australians have something called ‘fixed pricing.’ Most shops don’t use the phrases ‘Direct Repair Program’ or ‘network shops’ for insurance companies, but they have to keep the severity at a fixed cost for drivable or non-drivable vehicles. If it’s more than that and they bill each month, their Labor Rate gets lowered for the next working period. So, they do a lot of what they call ‘batch uploads.’ They pick and choose which final bill they want to upload to make sure they don’t go over that threshold. That, to me, is a lot of administrative burden. This causes a friction point between a lot of shops and insurers. Having an organization there like the Society of Collision Repair Specialists [SCRS] would help.

With some insurance carriers there, the shops don’t even get paid for materials; they just get paid a rate for paint labor that includes materials. Insurers put an emphasis on this ‘fixed pricing;’ they’re not really focused on cycle time or customer service metrics like we are in the States.

Shops in Australia only have one estimating system versus three here in the US. I had a chance to go to a shop and look at its estimating system. I was quite shocked; whereas our estimating system has graphics or pictures of the cars or parts, their estimating system has none of

[INDUSTRY] ADVICE that. They just have the name of the part. That’s a bit of a challenge for them, because we actually see pictures and can select the part.

Another thing I learned in Australia is that if you’re an insurance shop, you can only fix either insureds’ or claimants’ jobs; you can’t fix both. I also saw that they don’t have many OEM certification programs like we have here in the US. They don’t have General Motors, but they have what’s called Holden, which is the Australian version. Holden is just now rolling out a certification program there, as is Subaru. While they do have two or three, they don’t have all the certifications that we have here. They also don’t have any factory training. In fact, some of the shops that work on BMWs commented that they had to send their technicians to California for training.

Most of the technicians in Australia make about the same as they do here, and all of them are hourly. They don’t appear to have any great challenges with getting parts; they seem to have a pretty good handle on that.

There are no vehicles manufactured in the country, so everything has to be imported. As far as paint technology, they pretty much spray the same paint we do. Waterborne is not mandated there, but there are some shops that spray water. There are some MSOs in Australia. Fix

Auto has a little bit of a presence there, but there are no CARSTARs, Calibers or Service Kings. Some insurers actually own shops there. And of course, they have kangaroo hits instead of deer hits.

It was a wonderful experience. I hope I get the opportunity to go back.

Mike Anderson is an Accredited Automotive Manager (AAM) and the former owner of Wagonwork Collision Centers, two highly acclaimed shops located in Alexandria, VA. He has served as a member of many industry organizations throughout his career, including the WMABA Board of Directors, the Mitchell Advisory Board, the MOTOR Advisory Board, the ASE Test Review Committee, the National Auto Body Council, the Collision Industry Conference and the Society of Collision Repair Specialists. Additionally, he is a past Virginia SkillsUSA chairman, serves as a facilitator for Axalta Coating Systems’ highly recognized Business Council 20 Groups in both the US and Canada and facilitates numerous courses for Axalta Coating Systems’ Educational Series. He currently offers expert industry consulting via his latest venture, Collision Advice (collisionadvice.com).

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

New England Automotive Report February 2020 33

Superior service starts with superior parts.

Rely on what Mazda drivers already know-Genuine Mazda parts extend a car's life.

Designed specifically for Mazda vehicles Get the right part the first time We're an accurate, trusted resource as close as your phone Give us the opportunity to serve you

Contact these Mazda dealers for all your parts needs: Mastria Mazda 1545 New State Highway Route 44 Raynham, MA 02767 Phone: 877-272-8876 Fax: 508-802-4074 wholesale@mastria.com

34 February 2020

New England Automotive Report

Quirk Auto Dealers 115 E. Howard St. Quincy, MA 02169 Toll Free: 877-707-8475

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· Fax or emailing your order will speed processing and delivery to your location. © 2020 BMW of North America, LLC. The BMW name, model names and logo are registered trademarks.

New England Automotive Report February 2020 35

Get it right from the source.

Ford and Lincoln Mercury dealers are the one-stop source for all of your collision repair needs.

When you need fascias, grilles, headlamps, wheels or any other Ford Motor Company Genuine Part, call your local wholesaling dealership. They’re a great souce for technical and repair information as well. Using Genuine Parts can help your body shop reduce cycle time, improve relationships with insurance companies and satisfy customers. So get everything you need in just one call to your one-stop collision repair resource – your local Ford or Lincoln Mercury Dealership.

Contact these Ford or Lincoln Mercury dealers for all your parts needs: Imperial Ford 6 Uxbridge Road Mendon, MA 01756 Toll Free Parts: 877-272-0332 Toll Free Fax: 877-800-6316 Call us for your wholesale parts needs

Sarat Ford Lincoln Mercury 245 Springfield Street Agawam, MA 01001 413-786-0430 Fax: 413-789-3715 www.saratford.com

Quirk Auto Dealers 115 E. Howard St. Quincy, MA 02169 Toll Free: 877-707-8475

© 2019, Ford Motor Company 36 February 2020

New England Automotive Report

Audi dealers strive to make you an Audi Genuine Parts fan •

Audi Parts professionals are your subject matter experts on collision parts, replacement components and mechanical items.

•

Many Audi dealers offer technical service support hotline access that can reduce your repair times and help you meet an on-time promised delivery.

•

Installing Audi Genuine Parts contributes toward improved cycle time that helps make both your customer and their insurance company happier.

•

Regardless of the age of your customer’s Audi, Audi dealers have access to over 200,000 part numbers.

No other supplier comes close.

Helping you do business is our business. Order Audi Genuine Parts from these select dealers.

Audi Natick 549 Worcester Street Natick, MA 01760 www.bernardiaudi.com 800.247.3033 Fax: 508.651.6841

Hoffman Audi 700 Connecticut Blvd East Hartford, CT 06108 860.282.0191 Fax: 860.290.6355 www.hoffmanauto.com

Audi Peabody 252 Andover Street Peabody, MA 01960 800.774.8411 Parts Direct: 978.605.2182 email: pwalke@iramotorgroup.com www.audipeabody.com

Mattie Audi 80 William S. Canning Blvd.

Fall River, MA 02721 800.678.0914 Fax: 508.730.1283 www.mattieaudi.com

ZEROING IN [COVER] STORY By Joel Gausten

on Key

Objectives

AASP/MA Launches Board Committees

This year will be a busy one for AASP/MA. As shops throughout the state hit the ground running after the holidays and the start of a new year, the association is hard at work focusing on new solutions to long-running industry issues. For 2020, it has charted a new course of action with the formation of five committees within the Board of Directors devoted to specific areas of concern for members and non-members alike: Labor Rate/BillableGenie, Legislative/ADALB, Vendor Affinity Program (VAP), Events and Membership/Marketing.

“As the saying goes, ‘Many hands make light work,’” explains AASP/MA President Molly Brodeur, who chairs the Events Committee and serves on the Vendor Affinity Program (VAP) Committee. “With functioning committees working on their established goals, we feel the association as a whole can and will be much more productive. The purpose of the committee structure is to have focused efforts within the Board. AASP/MA had used the committee structure in the past but had gotten away from it for the past two years while we focused on redeveloping the chapter format, having local chapter meetings and getting a statewide Labor Rate Survey up and running and achieving a documentable prevailing rate.

Keeping a lot of the conversations that happen at the committee level outside of the monthly Board meetings allows us to function and act quicker, as the issues have already been hashed out and are ready for the full Board to vote on.”

The Labor Rate/BillableGenie Committee has been created to maintain pressure on the advancement of the state’s Labor Rate and enlist more subscribers to the BillableGenie program available through National AutoBody Research (NABR). The Legislative/ADALB 38 February 2020

New England Automotive Report

Committee will be devoted to promoting AASP/MA’s Labor Rate Bill and proposed legislation to move the Auto Damage Appraiser Licensing Board (ADALB) from the Division of Insurance to the Department of Professional Licensure.

“This Committee will also maintain a ‘watchdog’ position to ensure we don’t get ambushed by any legislativeor regulatory changes,” shares AASP/MA Executive Director Evangelos “Lucky” Papageorg. “It will also look at how the association can fund a full-time lobbyist position.”

The remaining three committees have been crafted to foster stronger relations within the AASP/MA community itself. The Vendor Affinity Program (VAP) Committee will seek out and maintain partnerships with participating vendors that contribute to AASP/MA’s efforts and success through sponsorships. In addition to coordinating the 2020 AASP/MA Golf Outing, the Events Committee will work on locating venues, sponsors and speakers/topics for the General Membership Meetings planned for April and September of this year. The Membership/Marketing Committee will be responsible for developing ways to increase membership and member services. Additionally, Papageorg says this group has been “charged with getting the AASP/MA brand more recognizable using different platforms in social media as well as in traditional print and news outlets.”

Naturally, the creation of these committees has led to excitement among Board participants. At-Large Director Adam Ioakim (Hogan & Van Auto Body; Medford), who serves on the Legislative/ADALB and Labor Rate/BillableGenie Committees, believes that it is critical for AASP/MA to take a defensive position against potentially harmful legislation.

“The real focus is on what’s lurking in the shadows and what the insurance companies are trying to do behind the scenes. If AASP/MA isn’t out there being the watchdog to defend against the bills they’re trying to pass, our livelihoods could really be ruined. We’re there to testify and provide documentation to help make sure those bills don’t go through.”

AASP/MA Vice President Kevin Gallerani (Cape Auto Body; Plymouth) is hopeful that his efforts chairing the Vendor Affinity Program (VAP) Committee and serving on the Events Committee will help shine a brighter spotlight on those companies that play a critical role in keeping the association’s activities afloat throughout the year.

“I want to make sure that our supporting vendors are being seen at these events and that shops know who they are so they can support them. Our goal is to help keep these important relationships going. We’re also looking to invigorate that program and bring more vendors into it as the year goes on.”

While he is not a Board member, veteran AASP/MA shop owner Jack Lamborghini (Total Care Accident Repair; Raynham) went above and beyond in 2019 in educating fellow members on the benefits of AASP/MA’s VRS

Standardized Labor Rate Survey (laborratesurvey.com).

He intends to do much more of this as a member of the new Labor Rate/BillableGenie Committee in addition to also participating in the Membership/Marketing Committee.

“The Labor Rate has been an issue going back 30 years. For the last few years, it’s gotten to the point of literal absurdity. We have one of the highest costs of living and doing business in the country, and we’re getting reimbursed the least amount of money of anyone in the country by far. It’s just wrong on every level you can imagine. This should be a very galvanizing topic for everybody. There isn’t anybody in the industry who thinks for a moment that what we’re getting paid is anywhere close to fair or realistic.”

“

With functioning committees working on their established goals, we feel the association as a whole can and will be much more productive."

- AASP/MA President Molly Brodeur

Above all, AASP/MA’s new committee structure will further demonstrate how the association is the primary source of information and assistance for the Massachusetts collision repair industry. As the committees move forward with their work, they are hopeful that new members will join AASP/MA and lend their time and voices to everything the association is striving to accomplish.

“Members are going to have a better idea of what’s going on,” offers AASP/MA Secretary Gary Cloutier (Cloots Auto Body; Westfield), who sits on the Membership/Marketing and Legislative/ADALB Committees.

“Things at the State House and the ADALB take a long time before they work their way to the surface, so members will continue to get accurate information from us firsthand and in a timely manner.”

“If someone isn’t a part of the association, they won’t know about things happening until they happen,” comments AASP/MA Collision Director, former Massachusetts Auto Body Association (MABA) President and Membership/Marketing Committee Chair Rob DelGallo (Factory Collision & Restoration; Weymouth), who is also on the Legislative/ADALB Committee. “You’re better off informed than having to figure out what happened. If you’re not at the table, then you’re not part of the decision-making.”

“If we don’t have some entity looking out for the interests of every collision shop owner, manager and technician in this industry, the insurance industry will run us over,” adds Lamborghini. “If people aren’t willing to support the association – at least from a financial standpoint – then we’re not going to have a voice to protect us going forward.”

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

New England Automotive Report February 2020 39

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40 February 2020

Kelly Nissan of Woburn 95 Cedar Street Woburn, MA 01801 Phone: 781-835-3510 Fax: 781-835-3580 E-mail: mbosma@kellyauto.com www.kellyauto.com

New England Automotive Report

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New England Automotive Report February 2020 41

[LEGAL] PERSPECTIVE By James A. Castleman, Esq.

CAR Performance Standards: The Other Side of the Coin In the November 2019 issue of New England Automotive Report (available online at grecopublish ing.com), I wrote in this column about why “cost containment” is still a major issue that must be dealt with when body shop appraisers are negotiating with auto insurer appraisers. As noted in the article, Commonwealth Automobile Reinsurers (CAR) is the statutorily mandated insurance industry organization that was established to manage the pool of Massachusetts high-risk drivers.

The law says that these drivers must be assigned to insurers on an equitable basis and be treated like all other insureds for almost all purposes. As part of its mandate, CAR is required to issue Performance Standards to govern how insurers manage the high-

risk pool. The Standards must be complied with by CAR’s participating insurers in all instances, not just when dealing with highrisk driver claims. CAR’s participating insurers consist of virtually all Massachusetts auto insurers.

In addition to requiring that high-risk insured drivers be treated in the same manner as other insureds, it is also part of its statutory mandate that CAR makes sure that its participating insurers have programs in place that assure that claims costs are “contained.” In line with this requirement, CAR’s Performance Standards include, among other things, requirements that its Assigned Risk Carriers (ARCs) have written plans that are designed to make sure that they seek the most

competitive Labor Rates and times; insist on the use of aftermarket, rebuilt or LKQ parts whenever “appropriate;” and make sure that they make efforts to obtain discounts and pay less than the full retail price for parts.

That, however, is only a portion of what the Performance Standards cover. In addition, they mandate that the ARC plans also address how to identify fraudulent auto claims and claims that may not be covered – whether because a particular policy does not include the necessary coverage, the operator was not a proper insured under the policy, the insured vehicle was not actually garaged where the insured claimed or because the vehicle was really being used for commercial rather than private passenger purposes. Moreover, the requirements are not only for auto damage claims. The Standards go into great detail about how the ARC plans must also address cost containment requirements for glass claims, rental claims, third-party personal injury claims, first-party no-fault personal injury protection claims, insurer administrative expenses and even how much the insurers pay their lawyers.

As a result, cost containment continues to be a major issue for repair shops – and anyone else dealing with any type of auto insurance claim.

There is Another Side of the Coin Despite all of the Performance Standards requirements that focus on attempts to reduce costs, there are also standards that mandate that insurers act in a manner that is fair to their customers and to others they deal with – which could even include

42 February 2020

New England Automotive Report

collision repair shops. That dichotomy is partially illustrated in the introductory paragraphs of the CAR Performance Standards, which say, among other things, “These Performance Standards are designed to contain costs, ensure prompt customer service and timely payment of legitimate claims and prevent the payment of inflated, fraudulent and unwarranted claims.” [Emphasis added.] They go on to state, “Also, these standards are designed to ensure compliance with Massachusetts laws and regulations regarding motor vehicle insurance…” So, no matter what an insurer’s plan says about programs to contain costs, those programs must also do so in a customer-friendly and timely manner within the requirements of Massachusetts law.

As an example, in regard to auto damage claims, the Performance Standards require that insurers “must establish programs and procedures to ensure prompt settlements of warranted motor vehicle physical damage claims” and “must establish procedures to permit prompt appraisal of damage and to make prompt claim payments of motor vehicle physical damage claims.”

The Standards go on to specifically incorporate the regulatory requirements that an appraiser be assigned within two business days of a claim and that the appraisal then be transmitted within five business days. Further, the Standards mirror the Direct Payment regulations by specifically setting a time frame of five business days after completion of the appraisal for payment of a first-party damage claim.

Additionally, for all auto damage claims, unless the claim is going to be referred for a fraud investi-

gation, “a decision must be made to promptly process for settlement.”

Other examples of pro-consumer Standards relate to total losses. One Standard requires that a vehicle not be declared a total loss unless the cost of repair plus salvage value is going to exceed the actual cash value (ACV) of a vehicle. That is, insurers cannot arbitrarily declare a vehicle to be a total loss nor determine total loss status by using a percentage formula. Further, the Standards mirror Division of Insurance regulations in mandating that insurers utilize all of the factors set out in the regulations for determining the ACV of a vehicle. These include: • the retail book value of a similar vehicle; • the cost of the vehicle plus improvements, less appropriate depreciation; • the decrease in value resulting from prior damage; and • the actual cost of purchase of an available vehicle of like kind and quality.

No one factor can be used to determine ACV. Services like CCC Information Services, by themselves, do not seem to be appropriate under the Standard.

Moreover, even in their cost containment requirements, the Performance Standards almost always qualify their mandates by making them applicable only where “appropriate.” As an example, one Standard requires that insurers “must allow for, and insist on, the use of aftermarket, rebuilt and LKQ parts in lieu of new or cost of repair, whenever appropriate.” [Emphasis added.]

But when are such parts “appropriate”? What if they don’t fit

properly? What if they have not met the same safety standards of the OEM parts that they replace?

What if they may not react in the same manner in an accident?

Under the Standard, if an aftermarket, rebuilt or LKQ part is not “appropriate,” then it should not be allowed for or insisted on.

The Unfair Claims Settlement Prohibition Another important pro-consumer portion of the Performance Standards is the section that mandates that insurers not engage in “unfair claim settlement practices.” Echoing the Massachusetts statute that prohibits such practices in the business of insurance, the Performance Standards include requirements that insurers “effectuate prompt, fair and equitable settlements of claims in which liability is reasonably clear.” Additionally, the Standards require that insurers don’t “fail to promptly settle claims, where liability is reasonably clear, under one portion of the policy coverage in order to influence settlements under other portions of the policy coverage.”

While such conduct may ordinarily subject an insurer to being sued for treble damages by a claimant or being penalized by the Commissioner of Insurance, it is important to note that CAR may also take action against a participating insurer for engaging in these practices.

So, What Are the CAR Penalties for Violation of Their Performance Standards?

Every participating insurer is required to be audited for Performance Standards compliance every three years. During the audit, the insurer must submit answers to a detailed questionNew England Automotive Report February 2020 43

[LEGAL] PERSPECTIVE naire, the insurer’s required compliance plan is reviewed and at least 270 policies with at least one claim apiece are intensely reviewed by CAR’s auditors. CAR sets methods of evaluating insurers’ compliance with its Standards, and an insurer must attain a compliance rating of 93 percent or better.

If an insurer does not meet the 93 percent compliance rating, then it must then submit a “remedial action plan” to CAR explaining how the insurer intends to make things better. In addition, the CAR Governing Committee can assess monetary or other appropriate penalties against the insurer.

Notably, insurers take the potential for being penalized seriously. Having to prepare and present a remedial action plan is time consuming and costly, and monetary penalties can be significant. Failure to meet the 93 percent compliance rating may also bring the insurer to the attention of the Commissioner of Insurance, and not in a good way.

If you wonder why an insurer may be adamant about insisting on paying for fewer days of storage on a particular total loss claim, or insisting that it not pay more than an artificially low Labor Rate, please understand that its decision to engage in these tactics may be strongly guided by fear of hav-

ing that claim being chosen for audit by CAR and dealing with the consequences. It may seem completely out of line to you, but it may have serious consequences for the insurer.

Conclusion As noted in the prior Legal Perspective, cost containment appears to be here to stay because of CAR Performance Standards, and collision repairers need to learn to live with it. It is, however, also important to know what the limits are on those Standards, what other CAR Performance Standards say and what an insurer is facing if it fails to comply with those Standards. Doing so may help to instruct you in how you deal with insurers in the future, and knowing what standards insurers are required to meet could help smooth the way in which you settle claims with them.

PROTECTING CONSUMERS AND THE COLLISION INDUSTRY

MASSACHUSETTS

Attorney James Castleman is a managing member of Paster, Rice & Castleman, LLC in Quincy, MA. He can be reached at (617) 4723424 or at jcastleman@prclawoffice.com.

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New England Automotive Report February 2020 45

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