23 minute read
What is the Funniest Customer Experience You've Had?
A body shop can sure be an interesting place. Surely, most shop owners can talk for hours, or days even, about all the challenging moments (especially with insurers!) they experience. Then, there are those occasions when something happens in the shop that leaves one laughing, giggling or just plain scratching their heads. So, we reached out to some of our veteran shop owners to hear about some of the funniest moments they’ve ever experienced with their customers. We found quite a few laughs!
AASP/MA Legislative Director at-Large Tom Ricci of Body and Paint of Hudson recalls a time an employee (literally) drove him right into a situation with a customer that still has him chuckling to this day.
A customer came in to pick up his vehicle; soon after, Ricci was called into the office. The customer was agitated, claiming he found some damage on the vehicle that wasn’t there when he brought it in.
“So, I see it and tell him that my guys are usually pretty honest and would tell me if they did something to the vehicle and that I really didn’t think it was us. Just as I’m in the middle of explaining this to the customer, one of my guys pulls the plow truck around and bumps it right into another vehicle awaiting repairs! What could I say to the customer after that? I just looked at him and said, ‘Ok, give me the keys.’”
As for the employee? Ricci says, “All I’ll say is, we had a little discussion.”
Long before his current role as executive director of AASP/ MA, Evangelos “Lucky” Papageorg ran a body shop at a Chrysler/ Plymouth dealer in Quincy. One day, he encountered a customer who had been in an accident. Nothing shocking there, but how this consumer and the woman he collided with handled things at the scene was beyond surreal.
“The police said, ‘Okay, nobody’s been hurt. Just exchange your license and registration, and you’ll be all set,’” Papageorg says. “So, the gentleman from the accident shows up at my shop. He gives me a license and registration, and I start filling out the estimate. I go out to look at what I thought would be a Cadillac, but it was a Toyota. I told him he brought me the wrong registration. He said, ‘Well, we just exchanged our licenses and registration like the officer told us to do.’ That’s literally what they did before parting ways. So, it wasn’t just one crash test dummy; it was two crash test dummies!”
Doug Santa Cruz (Anderson Street Auto Body) recalls quite a mix-up that gave a customer and his wife a lot to laugh about.
The customer came in asking the shop to check the noise he heard coming from his vehicle. After the car was on the lift and the source of the problem was found, the shop called him back. Santa Cruz says the wife answered, and they gave two estimates – a repair option versus a replacement of a part – and she approved the cheaper repair.
“When he came to pick up the vehicle, he tells us he never received a call. Turns out we called the wrong phone number. Some lady in another state approved the job – the lesser of two options. When he got home to his wife, he explained to her that he has ‘another wife’ in another state. So, his wife says to him, ‘As long as she keeps the cost of car maintenance down, she is a keeper.’”
JUST4FUN What is the Funniest Customer Experience You've Had?
PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
Members React to Insurer Abuse and ADALB Inaction
Conflicts between collision repair facilities and auto insurers are nothing new and happen everywhere, but they shouldn’t be anywhere near as bad as they are in Massachusetts.
For decades now, the state’s Auto Damage Appraiser Licensing Board (ADALB) has been in place to either award or revoke licenses for appraisers based on their technical knowledge and ability to follow comprehensive state regulations. In theory, the ADALB should be a rare jewel within the national automotive and insurance industries that actually provides a state-level mechanism for either side to address potential violations of the law. Unfortunately, years’ worth of coverage in New England Automotive Report indicates something vastly different and deeply frustrating. For many shops in the Commonwealth, the ADALB continues to fail to live up to its purpose to respond to filed complaints in regard to appraisal misbehavior.
Over the summer, AASP/MA launched a special 10-question online survey that asked members to share their experiences with some of the most common friction points with insurers. The results provided clear insight into the struggles impacting an industry constantly subject to the whims of an outside party. Of the 109 respondents thus far, 73 answered “often” to this question:
Do licensed appraisers representing the insurance company state they are not allowed to pay for paint and materials by “published manual or other documentation” as required in 212 CMR 2.0? (i.e., they say they will only pay dollars x hours.)
As another example of the trends uncovered through the survey, 88 respondents answered “seldom” to the following inquiry: the three business day requirement of CMR 212 2.0 for requested supplements?
What is a shop supposed to do when faced with dilemmas like these? Well, as it stands today, a complaint process is available through the ADALB. When it comes to attempting to utilize the Board to address shop-insurer disputes, few AASP/MA members have ever been as active as Don Dowling of Marblehead Collision. As of this writing, the shop owner and AASP/MA affiliate director has filed roughly 40 complaints over the past year. In all cases, he was prompted to go this route after an insurer appraiser failed to negotiate with him for a proper repair.
“They really stopped following the regulations even more during the pandemic.”
Not surprisingly, a good portion of Dowling’s current complaints pertain to P&M-related issues and the carriers’ inability to stick to appropriate timelines in looking at vehicles and subsequently producing the appropriate paperwork. Additionally, he is pursuing ADALB action on situations where insurers insist on paying a set price on pre- and post-repair scanning regardless of the specific make and model being repaired.
“They change [the price] every time. They’re not even following their own supposed guidelines.”
This issue extends to sublet bills, which are often met with an insurer stating it will only dole out a predetermined amount as opposed to the exact figure paid by Dowling’s shop to the outside service provider.
“They just pick a number they want to pay even though we physically handed them the other company’s invoice marked ‘paid in full.’”
To make matters worse, Dowling reports that certain insurer
appraisers are flatly refusing to acknowledge the need for his facility to perform safety calibrations and other ADAS-related procedures. He argues that this line in the sand goes against the following state regulation, which makes it clear that manufacturer- recommended/ required procedures should be used during vehicle repairs:
No appraiser shall modify any published manual (i.e., Motors, Mitchell or any automated appraisal system) without prior negotiation between the parties. Manufacturer warranty repair procedures, I-CAR, Tec Cor and paint manufacturer procedures may also apply.
(It should be noted that the ADALB voted in 2016 to revise a portion of this language to the following for added clarity as part of its proposed regulation changes submitted to the Division of Insurance:
Manufacturers’ recommended repair procedures, I-CAR, Tec Cor and paint manufacturer procedures shall apply. However, the selection of parts shall comply with 211 CMR 133.00 and 212 CMR 2.00.)
As of this writing, Dowling had not received a response from the ADALB in regard to when any of his complaints would be reviewed or heard. Meanwhile, relations between his business and certain insurers have devolved to the point where some jobs that were completed back in July were still sitting in his lot as of midAugust.
“We don’t know when we’re getting paid, so we can’t release [the vehicles].”
Dowling is certainly not alone in his frustration. Although he had yet to file a complaint with the ADALB at the time of his conversation with New England Automotive Report for this story, AASP/MA Affiliate Director Jeff White (North Andover Auto Body) stressed that this would soon change.
“There are things going on with insurers that are unacceptable.”
Some insurance companies’ refusal to properly negotiate with shops over paint and materials tops White’s list of grievances. Here’s a reminder of what current regulations actually state on the matter:
With respect to paint, paint materials, body materials and related materials, if the formula of dollars times hours is not accepted by a registered repair shop or licensed appraiser, then a published manual or other documentation shall be used unless otherwise negotiated between the parties.
Unfortunately, White reveals that insurers’ adherence to these words is virtually nonexistent in the real world, with many carriers simply stating they will pay a set figure without presenting any form of legitimate documentation to back up this dollar amount. In some cases, insurance appraisers have gone so far as to give signed field notes stating they would not provide it to justify what they’re willing to pay.
“I can’t tell anybody, from one car to the next, what it’s going to cost in materials to paint a car. I can’t arbitrarily pull a number out of thin air, but insurance appraisers are doing exactly that when they come in here. My argument to all of them is, ‘You can tell me it costs whatever per paint hour provided you can prove it to me through some sort of documentation. Once you show me how you came to that number, then we can actually negotiate.’ Some appraisers have suggested I’m not willing to negotiate. That’s not really the case; I’m just not willing to negotiate with somebody who doesn’t have an education behind them to tell me where their numbers are coming from.”
Naturally, this level of push and pull has left several insureds under-indemnified.
“What they’re really doing is hurting the consumer,” White observes. “I inform my customers before we take the jobs, ‘You may have to pay for additional paint and materials if your appraiser isn’t willing to follow the law.’ The insurers are really hurting them, not me. It really gets under my skin when an appraiser has no concern for how their failure to do their job properly does that to a consumer.”
Consumers are also negatively impacted when an insurance appraiser fails to respond to a shop’s supplement within a reasonable timeframe. Despite the fact that White sometimes gives a carrier up to five days as a courtesy, he has seen supplements go unanswered for as many as 19. He feels this is another issue worthy of the ADALB’s attention.
Of course, getting the ADALB to actually act on these and other matters is another story. After years of receiving frustrated feedback from members dissatisfied with this Board’s lack of action and regulatory oversight, AASP/MA is currently promoting critical legislation designed to finally change this for the better. Filed by Representative Tackey Chan of Quincy, House Bill 327 aims to move the ADALB from the Division of Insurance to the Division of Professional Licensure (DPL). It also seeks to expand the size of the ADALB to include two consumer advocates, one appointed from the Attorney General’s Office and the other from a consumer advocacy group, and replace the current Board chairman, appointed by the Massachusetts Commissioner of Insurance, with one appointed by the Commissioner of the Division of Professional Licensure. Additionally, it will set term limits for all ADALB members. White is supportive of the association’s efforts to hold the Board more accountable in enforcing Massachusetts regulations that benefit appraisers and the motoring public.
“Right now, with the conditions we face with the ADALB, it feels like they’re not taking this stuff as seriously as they should. We need to move the ADALB to the DPL to get an unbiased licensing board to oversee some of these complaints.”
Although no one in the state’s collision repair industry would disagree that the current ADALB is deeply flawed, the fact remains that it currently stands as the only avenue (short of pursuing legal options) that shops have to address appraiser misconduct. While this opportunity has recently resulted in a little more than a pile of unread complaints, these documents represent a paper trail of the auto body field’s attempt to utilize the system as it currently stands. Most significantly, every neglected ADALB complaint represents another reason why House Bill 327 needs to pass.
As White says, “At some point, one of these complaints has to stick or they’re proving our case for us that the Board needs to be moved. What we tolerate sets the bar in this business. The more we tolerate, the more we get stepped on.”
AASP/MA members and all licensed auto body shop appraisers are strongly urged to take the two-minute CMR Violation Survey at bit.ly/CMRviolationsurvey if they haven’t already done so.
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Repairer Beware:
Is There Coverage for That Loss?
I got a call a couple of weeks ago from a guy who was in deep trouble with his sister. He had borrowed her car, and while he was cruising down the street minding his own business, some distracted driver ran a stop sign and T-boned the car. The sister’s husband had not paid attention when telling their insurance agent what coverages they wanted for the car and had neglected to purchase collision coverage, so there was no first-party coverage. It should not have mattered though, since the other driver was fully at fault and their insurer admitted to liability.
The other car had the mandatory Massachusetts third-party property damage insurance coverage. The problem, however, was that there was about $13,000 worth of damage to the sister’s car, but the other driver carried only the statutory $5,000 minimum required coverage. Even though it was her husband who had neglected to buy collision coverage, and even though the brother had been driving carefully, the sister was blaming her brother for the problem and was looking to him to make up the $8,000 shortfall needed to pay for repairs.
In this particular case, the sister’s repair shop was told by the insurer what the third-party limits were before repairs began, so the shop did not get stuck. Many times over the years, however, I have received frantic calls from repair shops that have finished repairs or have partially finished repairs, only to find out too late that there would not be enough coverage on a third-party claim.
This is only one example of a situation in which an insurer may not pay a claim or may only pay part of a claim. If you are in the collision repair business, always be aware of those situations in which an insurer could deny or partly deny a claim, AND FOR EVERY INSURANCE- COVERED REPAIR, DETERMINE WHETHER AN INSURER IS GOING TO DENY A CLAIM OR PAY ONLY PART OF A CLAIM BEFORE YOU START
REPAIRS!
Ask the insurer directly and do it in writing – then make sure that you get an answer in writing. A good practice is to get your customer to sign a release that specifically authorizes the insurer to disclose the information to you and then email or fax that form to the insurer with your request for the information.
There are many situations in which an insurer may try to deny a claim or try to pay only part of a claim. The following are only some of them, but are among those you should know of – including when an insurer may be wrong in trying to avoid paying:
(1) The claimant owes money to the Massachusetts Department of Revenue (DOR). Many people are unaware of it, but there are three Massachusetts statutes that mandate that insurers notify the DOR before paying a liability insurance or life insurance claim of more than $500. And if the DOR has a lien against the claimant for back child support, government benefits paid (e.g., Medicaid payments) or back taxes, then the DOR has the right to intercept those payments and the insurer is then required to pay whatever is due directly to the DOR and not to the claimant.
There are two major limitations on these DOR intercepts, however, and it is important that repair shops know of these limitations. First, for auto repair claims, the statutes apply only to third-party property damage claims and not to first party collision or comprehensive claims.
Second, the statutes specifically exempt payments made on behalf of a claimant to third parties who have provided or have agreed to provide benefits or services related to the claim. By regulation, this includes payments to collision repair shops who are repairing a claimant’s car. So, a repair shop should be protected, but only if the payment is being made directly to the shop and is not being made to the claimant themselves. (The exemption also applies to hospitals and doctors providing medical treatment to personal injury claimants and to attorneys representing claimants in making insurance covered claims.)
Believe it or not, as has been reported to me recently, some insurers’ claims personnel apparently do not know of the repair shop exemption and erroneously have made claim payments to the DOR instead of to a claimant’s repair shop. Be careful! (2) An insurer will not pay a first-party collision claim if the operator of the vehicle at the time of the collision was a member of the insured’s household who was not listed on the insurance policy. Despite the apparent broad wording of this clause in the standard Massachusetts private passenger auto policy, there are actually major exceptions in which the insurer still must pay. In particular, the clause applies only if there would have been an additional premium due because the unlisted operator was an inexperienced driver or the operator would have been assigned more merit rating points than those persons who are listed on the policy.
Additionally, the clause applies only to household members. If the vehicle is being operated by an occasional driver who is
[LEGAL] PERSPECTIVE
continued from pg. 30
not a household member, then it does not matter if the driver is inexperienced or how bad their driving record is. (3) Under the Massachusetts private passenger auto policy, insurers will not pay on a first- or third-party claim if the vehicle was being used, or was available for use, for hire. This applies to vehicles used as delivery vehicles as well as those being used by Uber and Lyft drivers, even if they are just waiting for a fare pickup. The clause does not apply to carpools where the riders just share the expenses. It also does not apply to cars being used for volunteer transportation services under the direction of charitable organizations. (4) An insurer will not pay a first-party collision or comprehensive claim for damage intentionally caused by the insured, or by a member of the insured’s household or by anyone else using the vehicle with the insured’s consent. This one seems pretty obvious, but it isn’t always. What constitutes “intentionally caused” damage? Gross negligence or recklessness is not enough – it must be intentional.
This clause of the standard insurance policy is sometimes problematical, because insurers often do not determine that damage was intentionally caused until an extensive investigation has been completed. This is especially dangerous for repair shops, which may not know that an investigation has begun and only find out after repairs have been completed. And unfortunately, sometimes an insurer makes an erroneous determination of responsibility for damage, leaving a damaged car in unrepaired condition for a lengthy period of time.
Notably, the exclusion from coverage does not apply if the vehicle was being used without the insured’s consent. So, if a vehicle is stolen and the thief intentionally plows into a brick wall, then an insurer will pay for damage to that vehicle under the vehicle’s collision coverage. (5) An insurer will not pay for damage to certain specialty equipment. In particular, insurers will not pay a first-party claim for damage to certain audio, video, navigation or other electronic equipment, unless the equipment is permanently installed in the vehicle. Further, an insurer will only pay up to $1,000 for such equipment, even if it is permanently installed, unless it is installed in a location used by the vehicle’s manufacturer – that is, unless it was an OEM installation.
Insurers also will not pay for damage to custom furnishings or equipment installed in a pick-up, van or any similar vehicle. This includes “special carpeting and insulation, furniture, bars, television receivers, facilities for cooking and sleeping, height-extending roofs, custom murals, paintings or other decals or graphics.”
Also excluded from coverage is damage to equipment designed for the detection or avoidance of any law enforcement speedmeasuring device, i.e., radar detectors.
continued on pg. 36
continued from pg. 34
(6) An insurer will not pay for damage incurred in an accident while the insured vehicle was being used in a race, nor will they pay if the car was damaged while being used in a demolition contest or while “stunting.” This exclusion applies to first- and third-party claims. (7) An insurer will not pay on a first- or a third-party claim while the insured vehicle is being used by someone in their business of selling, servicing, repairing or parking cars. So, if a collision repairer smashes into a pole while driving their customer’s car, the customer’s insurer will not pay for damage to either the car or to the pole. Instead, the shop’s garage keeper’s liability insurance policy will cover the loss, but it’s subject to whatever their deductible is and whatever other limitations there may be in their policy. (8) An insurer will not pay a third-party property damage claim if the operator causing the accident did not have the consent of that vehicle’s owner to use the vehicle. So, if your car is stolen and is involved in an accident, then your insurer will pay for the damage to your car (as noted earlier) but will not pay for damage to the other car. The reason for this is that neither the insured nor anyone using their car with their consent engaged in any negligent conduct that caused the accident. The insured is not at fault, so their insurer will not pay a third party. (9) An insurer will not pay a third-party property damage claim for damage to another car or other property owned or rented by the insured or by the operator of the vehicle. The insurer will, however, pay for damage to your home or garage. So, if you negligently crash into another car you own, your insurer will not pay under your property damage coverage for damage to that other car; but they will pay under collision damage coverage if you have it for that other car. On the other hand, if you back out of your garage and forget to first raise the garage door, then your insurer will pay for damage to that garage door. (10) An insurer will pay the full amount of a third-party property damage claim only if their insured was 100 percent responsible for the loss. Under property damage coverage, the insurer is required to pay the amount that a court would award to the third-party claimant
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whose car was damaged due to the negligence of their insured. Under Massachusetts law, no amount would be awarded unless the company’s insured is more than 50 percent at fault. And after the 50 percent threshold is reached, the amount awarded would be based on the comparative negligence of the parties. So, if a third-party claimant is himself 25 percent at fault, then he would be entitled to be awarded only 75 percent of his damages. Because of this, be particularly cautious when dealing with a third-party insurer.
Conclusion
If you are in the collision repair business, you want to make sure that you are going to get paid for your work. And you do not want to depend on chasing your customer or trying to enforce your garage keeper’s lien on their car if your customer’s insurer or a thirdparty insurer does not cover the cost of repair. It is important that you know – before starting repairs – whether an insurer is going to pay the full cost of repairs. You usually have the ability to find out what coverage there is, and it is in your and your customer’s best interest to find out. So, do it!
Attorney James Castleman is a managing member of Paster, Rice & Castleman, LLC in Quincy, MA. He can be reached at (617) 472-3424 or at jcastleman@prclawoffice.com.
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