Fear Can Be a Killer

EVANGELOS “LUCKY” PAPAGEORG

When we think of the word “FEAR,” several things come to mind. Fear causes many reactions in the brain. Some are positive: Senses and awareness can be heightened. Adrenaline is pumped into your system, which can make you stronger and faster. Conversely, anxiety brought on by fear can have a very crippling effect. It can make you freeze; it can muddle your thoughts and make it very challenging to think clearly. It can become a killing paralysis. The cause of the fear or anxiety evades you, so you cannot readily see the solution, and the anxiety level increases even more.

As this message is written for the collision repair industry and not a group of psychologists, you may be asking yourself what this has to do with you. A simple fact is that we as collision repairers live in a world filled with anxiety and fear. We have so many responsibilities in our chosen profession that unless one walks in our shoes, they cannot truly appreciate the pressures we live with day in and day out. We are responsible to those individuals who select our shops to restore their vehicles to pre-loss condition. We are responsible to our employees, to keep our shop running with continued work coming in. We are responsible for making sure that we provide them with the best and most current training in a shop equipped with the latest technology for today’s vehicles. We are responsible to our customers to act as their advocates in the repair process to ensure they are being properly indemnified by their insurers under the policy they purchased. We are responsible to our own families to provide for them by keeping our businesses open and creating a fair and reasonable income and profit.

The anxiety and fear we feel, whether real or perceived, comes from the fact that unlike other retail businesses, we rely most often on a third party to pay for our services. This third party has interjected themselves into the repair process solely for the purpose of protecting their profits while feigning concern for their policyholders-turned-claimants. Over the years, the insurance industry has gone from working behind the scenes to openly and overtly twisting what is sold as protection to their policyholders to the goal of protecting their own profit margins. Record-setting insurance profits have been reported to have increased over the past several years. Apparently, these record-setting profits are not enough. Unhappy insurers complain they need additional raises to keep pace with the increases in the cost of running their businesses! (Read about it at bit.ly/InsurerRaises.)

Many years ago, Ina DeLong, who left the insurance industry to start a company called “Policyholders United,” spoke at an auto body association meeting here in Massachusetts. Her opening comment to the group was something along the lines of, “The only thing different between the Mafia and the insurance industry is that the Mafia dresses better.” The Mafia, for all intents and purposes, is defunct and does not carry the influence and fear it once did.

Some would argue that the “business model” the Mafia utilized lives on today in the business practices of the insurance industry. The overriding practice being the use of fear and intimidation. That fear and intimidation heightens the level of anxiety that collision repairers experience and has led many to not necessarily think clearly and to become immobilized and frozen when it comes to making decisions. Or to make decisions which are not in the best interest of the vehicle owner or the collision repair facility. The fear and anxiety, which come from the fear of losing a potential customer because the insurer labels you as a problem shop or not part of their referral/programs, has forced the collision industry here in Massachusetts to the brink of collapse. Shops, which prided themselves in putting their customers first and foremost, were and are forced to be on lists they truly do not want to be on, to work at suppressed labor reimbursement rates and accept “prevailing” repair procedures set by contractual arrangements by the minority of collision shops, not the majority.

The good news is that more and more collision shops and their customers are putting an end to this insurer-created cycle… No longer are shops just taking what is being “given” to them by insurers. They have been educating the customers and creating advocates in increasing numbers. Advocates who no longer look at insurers as the authority in the repair process. Advocates who no longer live in fear of losing their coverage because they demand to be paid properly. These customers are recognizing that a collision shop which is booking out weeks in advance and charging a fair and reasonable labor reimbursement rate must be doing something right. They realize that they need to be a part of the process and that partnering with their repairer can alleviate their anxiety in the long run.

We have recently experienced the first increase in a labor reimbursement rate (provided by insurers) in far too long, but there is a long way to go to truly reach a level of reimbursement which is representative of the expertise and liability collision repairers accept in the repair process. Daily, insurers (both nationally and Massachusetts-based) are raising their rates paid on original estimates as well as when being pressed during the negotiating process. Much of that success comes from the fact that, “You leave me no choice but to charge your insured the difference between my

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