5 minute read
EXECUTIVE DIRECTOR’S MESSAGE
Where Do We Draw the Line?
by CHARLES BRYANT
It’s no secret that the collision repair and insurance industries have differed on the issue of what it should cost to repair vehicles for longer than any of us have been around. Over the years, the insurance industry has come up with more ways to save money and control the cost of repairs than one could imagine. From aftermarket parts all the way to the issue of inferior Labor Rates, the two sides simply do not see eye to eye for the most part. Ethical shops strive to repair vehicles in a way that instills consumer confidence. The problem is that the collision industry has an insurance company standing between them and that customer in an attempt to control every aspect of the repair from start to finish. Unfortunately, the insurance company is the one that ultimately writes the check for this work.
This is nothing new. This battle has been going on since time began. However, what is new is the level of vehicle technology on the roads today. For example, automobiles equipped with ADAS must be scanned and recalibrated when involved in an accident; otherwise, those vehicles will not perform as designed by the manufacturer. With this change in the industry, there have been more and more disputes between the two industries than ever before. Now, to make matters worse, along comes COVID-19. First of all, the insurance industry had been trying to get the concept of preparing estimates based on photos rather than personal inspection for some time. However, when the pandemic came along, the insurance industry used this as an excuse to say that they can’t come out and inspect the cars and that the shops must participate in the photo estimating process – like it or not. Things went downhill from there. Photo estimates were supposed to expedite claims. However, this process has actually delayed claim settlements drastically. Claims that normally would result in the car being repaired in a week or two are now taking up to five weeks. The reason for this is that the shops write an estimate, go along with the insurance company, send photos along with the estimate for thousands of dollars and wind up getting an estimate back for only a few hundred. From there, insurers would ask the shops to send more photos or take them in better lighting. However, even when the shops send in better photos, the insurer once again writes a small estimate for only a few hundred dollars more. This goes on for weeks and weeks until it finally gets to the bottom line of the repair cost and the vehicle is often declared a total loss. One would think that things would get better over time. However, it has become obvious that the insurance industry is still taking full advantage of the COVID-19 situation rather than trying to help people get through these hard times and treat them fairly when they’re involved in a collision.
A prime example is what recently happened when a customer’s vehicle was declared a total loss and the insurer evaluated it based on photos rather than perform an inspection to make a realistic determination of its value. Based on the photos submitted, the insurance company utilized the CCC program to determine the value of the car to be just slightly over $500. Obviously, the vehicle owner freaked out and demanded that the insurance company physically inspect the car’s condition and have an expert determine the actual cash value. That inspection resulted in the actual cash value of the car changing from just over $500 to over $11,000. In other words, a real live inspection resulted in the actual value being more than 20 times higher than what the insurance company attempted to settle the claim for based on photos.
Another recent situation based on photo estimating resulted in the insurance company refusing to pay for a steering rack even though the shop produced a manufacturer’s position statement making it clear that this needed to be done. Once again, photos simply do not tell the story, and that would’ve been revealed had the insurer actually seen the damage that called for the rack to be replaced. After a lengthy time fighting with the insurer, the shop was ultimately able to convince them that the procedure needed to be performed. Had the shop not replaced it, there is no doubt that serious injury or death could have occured to the occupants of the vehicle or anyone who got in its path.
The process of insurance companies attempting to evaluate damage to vehicles and place value on them without ever physically seeing them is simply not working. Where do we draw the line? When an insurance company attempts to settle a claim for 20 times less than its actual value or refuses to pay for a safety-related item that could prevent fatal consequences, something has to be done. A line must continued on pg. 44
Co-celebrating decades of creating chemistry between two industry leaders
Here’s to 235 years of combined service excellence
This year, as Albert Kemperle Inc. celebrates its 80th anniversary, BASF also celebrates its 155th anniversary. We are proud of our decades of partnership with BASF and years of serving the auto paint and body industry together. Kemperle’s founders would be proud of this relationship and the growth their company has experienced because of it.
Today, as we look forward to many more decades of service to our customers, we find ourselves filled with gratitude. The creativity, hard work, and sense of responsibility of the people working for our two companies have made us what we are today.
Thank you for your many years of loyalty.
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