Charge Copays in Challenge to DOS

all or a part of the customer’s payment to the Repair Shop is not supported by Massachusetts law and may be a false or fraudulent statement” to mean that “they are never required by law to pay or reimburse any additional amounts for repair work.”

Contradicting this belief, Castleman stressed, “In direct contravention to the quoted statement in your Notice, the multiple legal avenues available to customers to challenge an insurers’ payment to them, as provided by various statutes, regulations, case law holdings and language of their auto insurance policy is testament to such a suggestion being supported by Massachusetts law.

“Further, not only are insurers sometimes required to pay such additional amounts, sometimes insurers are in violation of M.G.L., c. 176D §3(9), the so-called Unfair Claims Settlement Act, when they do not pay such additional amounts. And, I can attest from personal experience representing multiple repair shops and their customers, that sometimes insurers are found to be in violation of that statute, and insureds are awarded multiple damages and their attorneys’ fees when a Court determines that an insurer has failed to make such payments.”

In response to the Notice’s claim that “Absent a final decision from such dispute resolution [statutes and regulations referred to in the Notice], the insurer is not obligated to pay the amount either the claimant or the Repair Shop demands,” Castleman pointed out common law tort principles, requiring insurers (by statute) to pay ‘all sums the insured shall become legally obligated to pay as damages because of injury to or destruction of property.’

“It is suggested that using third party claims as a basis for the statements in your Notice just does not make sense, either from a factual or legal perspective,” his letter continued, also noting that at least one of those three insurers were aware of their legal obligation to pay the additional charges as evidenced by the fact that they voluntarily paid those charges upon the claimant’s request.

Castleman closed with a request that the DOS officially issue clarification of the Notice to correct the misstated facts and clarify legal issues as described in the letter to Director Cassidy.

In response, Director Cassidy wrote, “The Division believes the content of the Notice is correct and does not believe any clarification is warranted.”

"I have been doing this a lot of years, and it has been rare that I have gotten this type of response ever, from any government agency,” Castleman told New England Automotive Report. “And, I stand by everything that was in my letter.”

Stay tuned to New England Automotive Report as AASP/MA continues to monitor this issue.