Contents
NOVEMBER 2021
on the
cover
Official publication of the Auto Body Association of Texas
TESLA TO TEXAS:
ABAT BOARD OF DIRECTORS
Insurance Has Launched and Landed!
16
by Chasidy Rae Sisk
President Burl Richards Burl's Collision Center burl@burlscollision.com (903) 657-8082
Vice President Eric McKenzie Park Place Dealerships emckenzie@parkplace.com (214) 443-8250
Chairman of the Board Corey Pigg S&W Expert Collision Repair coreyp@swcollision.com (936) 634-8361
Treasurer David Osburn Paint Works davidosburn@paintworkstyler.com (817) 648-5797
Executive Director Jill Tuggle jill@abat.us (817) 899-0554
ABAT BOARD MEMBERS
DEPARTMENTS
4
PRESIDENT’S MESSAGE by Burl Richards Building Momentum and Optimism for the Future
6 8
EXECUTIVE DIRECTOR’S MESSAGE by Jill Tuggle Back to Business: Consumer Forms
10 14
LOCAL NEWS Donated Salvage Vehicles Provide Students with Hands-on Experience
18
ASK THE EXPERT by Robert L. McDorman Can a Policy’s Right of Appraisal Resolve the Salvage Value Dispute between the Insurer and Insured?
20
INSURANCE ADVICE: ASK MIKE by Mike Anderson How Do We Empower & Educate Our Customers before There’s a Problem with Their Insurer?
EDITOR’S MESSAGE by Chasidy Rae Sisk Excited for This New Adventure!
ABAT FEATURE Leading by Example: Mike Anderson of Collision Advice Joins ABAT
Bobby Beason DeMontrond Collision Center bobby.beason@demontrond.com (936) 577-2747
Robert McDorman Auto Claim Specialists rmcdorman@autoclaimspecialists.com (817) 756-5482
Larry Cernosek Deer Park Paint & Body lcwrecker@comcast.net (281) 930-1539
Chad Neal Innovative Collision Equipment Chadwneal@yahoo.com (817) 527-2143
Kevin Ellison Westway Ford kellison@vtaig.com (972) 584-9033
Logan Payne Payne & Sons Paint & Body logan@paynescollision.com (214) 321-4362
Chad Kiffe Berli's Body & Fine Finishes chadk@berlisbody.com (512) 251-6136
Manuel Rubio Miracle Body & Paint manuelr@miraclebp.com (210) 843-9564
John Kopriva Kopriva Body Works jtkopriva@gmail.com (713) 923-4412
Darrell Smith McDaniel’s Quality Body Works Inc darrell-mcdaniels@sbcglobal.net (903) 753-5391
Greg Luther Helfman Collision gluther@helfman.com (713) 574-5060
Mike Williams All Star Collision Center sales@allstarcollision.us (903) 589-3160
Published by: Thomas Greco Publishing, Inc. 244 Chestnut Street, Suite 202, Nutley, NJ 07110 Corporate: (973) 667-6922 / FAX: (973) 235-1963 PUBLISHER Thomas Greco / thomas@grecopublishing.com SALES DIRECTOR Alicia Figurelli / alicia@grecopublishing.com EDITORIAL/CREATIVE COORDINATOR Alana Bonillo / alana@grecopublishing.com MANAGING EDITOR Chasidy Rae Sisk / chasidy@grecopublishing.com OFFICE MANAGER Donna Greco / donna@grecopublishing.com PRODUCTION COORDINATOR Joe Greco / joe@grecopublishing.com
ADVERTISERS’ INDEX 300 Advantage..................................................... 11
Paint Works Dallas............................................... IFC
Auto Claim Specialists........................................ 19
Reliable Automotive Equipment....................... 12-13
Beacon Equipment Resources......................... 9
Spanesi................................................................... 22
CAR-O-LINER Southwest................................... 15
Tasco Auto Color................................................. 21
Ecotech................................................................... IBC
Thomas Greco Publishing.................................. 11
English Color & Supply....................................... 10
USI............................................................................ 5
FindPigtails.com.................................................... 9
Valspar Refinish.................................................... OBC 3 NOVEMBER 2021 Texas Automotive
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TEXAS AUTOMOTIVE is published monthly and is sent to ABAT members free of charge. Subscriptions are $24 per year. TEXAS AUTOMOTIVE is published by Thomas Greco Publishing Inc., 244 Chestnut St., Nutley, NJ 07110. The editorial contents of TEXAS AUTOMOTIVE are copyright © 2021 by Thomas Greco Publishing Inc. and may not be reproduced in any manner, either in whole or in part, without written permission from the publisher and/or editor. Articles in this publication do not necessarily reflect the opinions of Thomas Greco Publishing Inc. Stock Images courtesy of www. istockphoto.com.
President’s Message
Building Momentum and Optimism for the Future
W
While ABAT was planning its sixth Texas Auto Body Trade Show as our country is beginning to come out of the COVID-19 pandemic, we were unsure what to expect, but the results were encouraging - we definitely hit a home run with this year’s location, and I think we always do a really good job with our classes. The folks who speak each year are top tier presenters, and they do a fantastic job of educating attendees on the industry’s current concerns. But the thing I’m most excited about is the BIG SHOTS competition, which we’re now calling “The ABAT Olympics.” We held two separate estimating contests, painters competed for an award, and we also had the body man category. Since our first year, I’ve felt that it’s important to get more technicians to come out to the show - these are the guys who are using the tools and equipment from our vendors and who are also in most need of the information taught in our classes. This time around, more technicians attended, and I’m really looking forward to making the ABAT Olympics even bigger and better next year. I believe this event is going to tremendously help us attract more techs; I’m very optimistic about next year’s event! If you’ve never participated, you don’t know what you’re missing, but whether you’re in Texas, or if you’re nearby in Oklahoma, Louisiana or Arkansas, I want you to know that it’s definitely worth the trip and something well worth checking out. You’ll read more about it here in a couple pages, but here at ABAT, we’re very excited that Mike Anderson decided to join our association - we know we’re doing something right when one of the industry’s best educators wants to be part of what we’re doing! We’re always looking to grow and expand into different markets because we want to support as many collision repair shops and as many industry professionals as possible.
Burl Richards ABAT President
And this industry needs more professionals because there’s such an employee shortage - just about every shop owner I know is suffering from employee woes and issues. Unfortunately, the biggest thing these kids have got going for them when they graduate from these schools is their desire to be in the industry, but when it comes to hands-on knowledge, most of them can’t even take a bumper off a car! I’m all about training and education, but these kids come out with certifications and can’t do much. Collision professionals need to get involved with their local advisory committees to provide feedback about what they should be teaching those students - and then the schools need to actually listen to that feedback. Instructors should be attending association meetings as well; we have resources because body shops have relationships with jobbers and other folks in the industry, like salvage yards. You don’t need a whole car. Give me a door that you can hook up to a battery so the window regulator works up and down and the door opens and closes, and then take that kid who wants to do bodywork and show them how to disassemble the door, take the trim panel off and the window regulator out. THAT student is going to graduate with some knowledge that allows me or another shop to hire him or her and pay them just a bit more as we teach them more advanced skills. We need to get creative and think outside the box if we’re going to address the problems our industry is facing. We’ve got to always be looking down the road to figure out what we can do and make sure we’re prepared, and if we do it together, we’re going to have a greater chance of success. burl@burlscollision.com
ATTN ABAT MEMBERS:
TXA
GIVE YOUR CONSUMERS A VOICE!
If you have customers who’ve had issues with their insurance companies (under-indemnification, total loss disputes, etc.) while their vehicles were at your shop, Texas Automotive magazine wants to hear their stories! Contact Texas Automotive Managing Editor Chasidy Rae Sisk at (302) 593-7002 or chasidy@grecopublishing.com to discuss having their story featured in our newest series, “The Consumer’s Voice”! 4 NOVEMBER 2021 Texas Automotive
Russell & Smith Logging Big Paint Hours with USI Booths & Prep Station Buying a paint booth is a huge investment, and there are many factors to carefully consider before selecting one. Will the booth work well in a region where there’s a ton of humidity and with drastic changes in the weather? How long do you think the booth will last and will it require a lot of maintenance? Will your painters be comfortable using it every day and finally, will the company making the booth provide solid training and reliable customer service? To answer these questions before acquiring two Chronotech spray booths and a prep deck from USI ITALIA back in 2004, Collision Center Manager Kevin McIllveen at Russell & Smith Body Shop in Houston, TX spent six months studying the market. He was looking for the best booths that matched his needs to use in a brand-new 36,000 sq. ft. facility that the company built from the ground up. Mcllveen, age 56, entered the industry more than three decades ago as an estimator and has worked for Russell & Smith Body Shop since 1993. His goal with his new spray booths was to improve the efficiencies in his paint department and to accommodate his production, he said, while simultaneously saving time and energy if possible. The vetting process was arduous but worth it in the end. "We did our research so that we could make an educated decision," he said. "I went to NACE two years in a row and talked to literally everyone and asked a lot of questions. We knew that this was going to be a very significant investment, so we took the time to perform our due diligence to cover all our bases. We invested in their prep stations as well, which was another good decision, because my guys can work so much faster and effectively with five different places where we can spray. We put a curtain up in the prep booth that provides us two additional spaces that are heated and properly ventilated. So, when we are really jammed, we can handle the workload and maintain our cycle time without interrupting or slowing down our production." After using them for a very short time, Mcllveen could clearly see that his Chronotechs were more than capable as they quickly became a centerpiece in his new, high-end, modern shop. "We have four paint teams here, consisting of a painter and a painter’s helper and we consistently log approximately 600-700 paint hours weekly,” he said. “We switched to waterborne paint when we opened this facility because we want to provide a healthier climate for our employees and the community as a whole.” Why was Mcllveen able to improve his numbers by simply adding two USI booths? “In the end, it all comes down to their airflow because we never need blowers or additional air to cure these vehicles. The fans in these Chronotechs are exceptional because they feature variable speeds, so we can switch depending on the parameters of each job. Our painters are producing an impressive product day after day, so these booths are saving us both time and money. We paint an average of 400 cars every month, so
we push these booths and they never let us down.” Any issues that Russell & Smith Body Shop have encountered with their USI ITALIA booths have been rare and far between. But Mcllveen feels good knowing that if called upon, the company will respond and find solutions promptly. “If you do your scheduled maintenance and keep everything clean, these booths will last you 30 years and maybe even longer. The issues that we have encountered with the Chronotechs have been minor and quickly solved, which is impressive when you think that we have been using these booths daily for the last 16 years. I tell people that these booths will be here long after I’ve retired!” After training provided by USI ITALIA, Mcllveen’s painters were able to start spraying after one day, he said. "The Chronotechs are designed to work with waterborne paint, which makes it easier for our painters to do their work. After a very short time, all of our guys were comfortable and the results were consistently exceptional.” Mcllveen is also impressed by the Chronotech's sturdy construction and durability. "Some booths are just a box, but these are wellbuilt," he said. “I know, because I've seen them all and there isn't anything like a USI ITALIA booth." His career in collision repair industry has been a great experience and products like his USI ITALIA spray booths and prep station are a part of that, he said. “We haven’t had to furlough anybody here and that’s because we value our people and, in the end, our Chronotechs are part of the team.”
USI of North America | 565 Commerce Street Franklin Lakes, NJ 07417 | 201-405-7761 | s.moretto@usius.com | www.usius.com 5 NOVEMBER 2021 Texas Automotive
Executive Director’s Message
Back to Business: Consumer Forms Jill Tuggle
ABAT Executive Director
A
As I sit and write this message, I think to myself, “I can’t believe this year is almost over” and I’m sure it goes without saying that we are all hopeful that next year will be different, that all our hopes for 2021 will come to be in 2022. But maybe that’s a message opener for next month. For now, the party is over, and it’s back to business. The “party” being the 2021 Texas Auto Body Trade Show, of course. And the planning and execution of such a big event has the tendency to put all of our usual business on hold for a couple months. Remember those consumer forms? It’s time to get back in the saddle and send them in again. The 87th legislative session is over for HB 1131, but much of the real work comes during the interim. Our consumer safety bills have made continued progress each session, and we must keep up the momentum. We are almost halfway to our goal of 1,000 forms submitted. I have heard so many times that we stand no chance fighting against the insurance and LKQ lobby, but that couldn’t be more untrue! What is true is that if we neglect to put in the work, then they will surely devour us. I have written about this before, but it deserves repeating: NOTHING is more powerful than an outcry from the consumer. If you are not familiar with the form, it is a simple checklist to be completed by your customers if they face the common challenges brought on by the insurance companies in the repair process. In the case that they are not fully indemnified, suffer unnecessary delays or if their total loss was undervalued or abandoned, that’s when you would utilize this form. Additionally, it is a great opportunity to have the conversations that must often be had when a customer drops their vehicle off: “Your insurance company may not be willing to reimburse
Our consumer safety bills have made continued progress each session, and we must keep up the momentum.
We are almost halfway to our goal of 1,000 forms submitted.
you for all necessary parts or procedures to safely and properly repair your car, and you may have to come out of pocket to return your vehicle to its preloss condition.” These forms are filled out at the end of the repair and sent to me so I can file the form and send it to your local legislators to make them aware of the daily struggles you face while trying to put Texas drivers back in safe cars. The importance of each one of you getting involved in this initiative cannot be stressed enough - we must cover ALL 150 districts in the Texas House of Representatives. From those of you in El Paso to Beaumont, Dalhart to Padre - and EVERYONE in between we need you! Just 10 forms could make the difference in getting this legislation passed and changing your business forever. Can you imagine the day you are collecting for all manufacturerrequired procedures? Getting paid your posted Labor Rate? Not hearing “We don’t pay for that” on a daily basis? It’s just a few forms away from becoming reality, but we need to be ready before the next session, which will begin in just 15 short months. Please contact us to get a copy of our most recent form and be a part of making some big changes in Texas!
jill@abat.com
TXA
6 NOVEMBER 2021 Texas Automotive
7 NOVEMBER 2021 Texas Automotive
Editor’s Message
Excited for This New Adventure!
I
Chasidy Rae Sisk Editor
I’m ecstatic to greet y’all as the new managing editor of Texas Automotive! For those of you who don’t yet know me, I first started writing about collision repair in 2010 and quickly found this industry to be filled with some of the warmest, most caring individuals I’ve ever encountered. Despite my complete lack of knowledge about anything related to cars (beyond how to make them stop and go), the folks I’ve met have always been willing to share their insights and help me understand what’s what – beginning with my first interview when I timidly asked a shop manager, “What’s a DRP?” Over the years, I’ve learned a lot, yet I realize that I still know next to nothing when it comes to the complexity of modern vehicles. When friends express their awe that little ol’ me writes about cars, I never hesitate to explain: “I just know a lot of really smart people.” Although I’ve only been working at Thomas Greco Publishing for a couple months, I’m fortunate enough to have met some really great people, starting with Burl Richards in 2014 when ABAT was founded. Over the years, I’ve received invaluable information and feedback from others, such as Jill Tuggle, John Kopriva, Larry Cernosek, Chad Kiffe, Eric McKenzie and so many others. The list of awesome collision repair professionals is bigger in Texas too! Thank you all for graciously tolerating my incessant requests for information…and for being prepared to be bombarded with even more questions in the future. I look forward to expanding that list of industry professionals in my Texas network – and hopefully those I call friends – as I get the opportunity to meet more ABAT members and industry leaders. I appreciate your knowledge, talent and hard work more than I can articulate. One of my favorite things about this industry, besides the people, is how multi-faceted and diverse it truly is and continues to become as technology advances. Hear me out; while I know those advances are a pain in your you-know-what, it provides limitless
possibilities to explore unique ideas, discover innovative processes and garner new experiences. Because to me, new thoughts and experiences make life so much sweeter. In the short time since I joined the team at Thomas Greco Publishing, I’ve already enjoyed several new adventures: Driving a golf cart (the same day that I stepped onto my first golf course), walking around a trade show with co-workers and visiting new places. By the time this edition is mailed, I’ll be in Las Vegas, attending the 2021 SEMA Show, which will be my first rendezvous with that renowned event, as well as my first opportunity to meet many of you in person after years of talking only by phone or email. I’m honored that Tom Greco hired me and grateful for the faith that he, Alicia, Joel, Alana, Donna and Joe (the whole TGP team) have placed in me. I know that I have some BIG shoes to fill – and although my feet are undoubtedly smaller than Joel’s, I look forward to the challenge. I’m also proud to have such an awesome opportunity to continue writing for this wonderful industry and the amazing professionals that comprise it. Each of you does your best every single day to ensure the cars you repair are safe because you care about the people behind the wheel. Likewise, I care about the people reading this magazine and will strive to bring you the most useful information possible to help you continue keeping our roads, our families and our neighbors safer. At the end of the day, Texas Automotive is YOUR magazine, so please never hesitate to reach out to me with topic suggestions to help ensure that we’re providing the information you actually want to know. Thank you to everyone who has embraced and welcomed me as I embark upon this new adventure. I look forward to continuing to provide you with the high-quality content that you expect from this magazine. I’m so excited to see what the future holds for all of us, and I hope you are, too! TXA
8 NOVEMBER 2021 Texas Automotive
9 NOVEMBER 2021 Texas Automotive
Local News
Donated Salvage Vehicles Provide Students with Hands-on Experience Collision repair instructors around the country commonly complain about a lack of funding for their programs, limiting their ability to provide the level of in-depth training required for their students to successfully pursue careers in shops after graduation. Financial constraints make it particularly difficult for schools to obtain modern vehicles that expose students to new-age features, such as the ADAS located in nearly every new vehicle. “Collision instructors across the country have shared that their number one need is having current model vehicles for their students to practice on,” Collision Repair Education Foundation (CREF) Managing Director Brandon Eckenrode shared. “As the industry is looking for graduating collision students to be ready for entrylevel employment, CREF invites businesses to join in our efforts to support their local programs to ensure that can happen through donated vehicles, tools, equipment and supplies.”
Each year, requests for late model vehicles and vehicle parts are at the top of the list for most instructors who complete the CREF Collision School Career Readiness Benchmark Grant application. To help solve this dilemma, Allstate partnered with CREF to provide salvaged vehicles to schools around the US - including several Texas high schools and colleges. CREF chose to provide vehicles to schools that have the greatest need. Texas Southmost College (Brownsville, TX) received a 2011 Chevrolet Silverado, and a 2018 Mitsubishi Mirage was donated to Judson High School (Converse, TX), while Collin College (Allen, TX) students have the opportunity to learn on a 2016 Kia Optima. Four vehicles were donated to JB Hensler College and Career Academy (Manvel, TX): a 2014 Toyota Prius, a 2016 Toyota Camry and two Ford Fusions (2013 and 2014). A 2011 Ford Mustang and a 2015 Nissan Sentra were donated
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to Texas State Technical College (Harlingen, TX), and Kingwood Park High School (Kingwood, TX) was happy to receive a 2013 Ford Edge, 2014 Toyota Corolla and a 2017 Toyota Camry. A seventh donation is underway with Tarrant County College (Fort Worth, TX). The school will receive a salvage vehicle soon. Learn more about how to get involved with supporting your local collision repair students by visiting CollisionEducationFoundation.org. TXA
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973.667.6922 | info@grecopublishing.com 11 NOVEMBER 2021 Texas Automotive
ABAT Feature
Leading by Example:
Mike Anderson of Collision Advice Joins ABAT Between dealing with advancing technology, the ongoing technician shortage and the overall challenges of the past 18 months, life as a collision repairer just keeps getting more difficult. Trying to handle everything on your own becomes exhausting and overwhelming, but trade associations (like ABAT!) are designed to alleviate some of the burden by providing tools and resources to help shops. Since ABAT was founded in 2014, its leadership team has focused on bringing value to members by providing educational opportunities, hosting networking events and sponsoring legislative initiatives to improve the industry for all collision professionals. The association’s hard work was recently evidenced when industry favorite Mike Anderson of Collision Advice joined ABAT. “Actions speak louder than words, and I believe in leading by example,” Anderson explained. “ABAT is an awesome association with a great leadership team, and I believe in what they’re doing. When you look at the areas around the country where shops have the best severity and labor hours, they share one thing in common: they have strong associations. “Our industry is going through some really difficult challenges right now, and it’s important to surround ourselves
Mike Anderson at ABAT’s 2021 Texas Auto Body Trade Show
“Actions speak louder than words...We’ve got to have stronger associations, and that strength comes from involvement.” - Mike Anderson with people to encourage us along the way,” he continued. “If you watch people run a marathon, they don’t do it alone - people along their path hand them water or a granola bar. Similarly, the association is there for its members; it develops into a sort of brotherhood or sisterhood.” Referencing efforts to change legislation to create a level playing field for shops, Anderson noted that associations work to benefit every shop, whether they are members or not, whether they are DRPs or independents. “It’s time we stop talking about where we differ and focus on where there’s common ground, like the staff shortage impacting everyone. We need to be focused on training and recruiting new people into our industry by supporting schools and staying on the cutting edge. ABAT offers great educational segments to benefit both new and old repairers and ensure shops are being educated on the proper ways to do things.” With so many challenges plaguing the industry, creating a supportive, collaborative community is more important than ever. “If this industry is going to change and improve, we’ve got to have stronger associations, and that strength comes from involvement; everybody needs to get involved! They can’t expect 20 percent to do 80 percent of the heavy lifting. There are many opportunities to create synergies - the more united we are, the louder our voice becomes and the more progress we make for the good of the entire community of collision repairers.” TXA
14 NOVEMBER 2021 Texas Automotive
Cover Story
Tesla to Texas: Insurance Has Launched and Landed!
It’s official: Tesla has invaded the Lone Star State. Last year, Tesla CEO Elon Musk moved his personal residence and also began constructing a new factory in Austin. During the same meeting that an announcement was made relating to the OEM’s headquarters’ relocation to the new facility, Musk also revealed that Tesla Insurance is ready to launch into Texas. Offered to all Model S, Model X, Model 3, Model Y and Roadster owners, Tesla Insurance has been available in California for a couple years, but its Texas iteration plans to use customers’ real-time driving behavior and “safety scores,” rather than credit, age and gender to determine premiums, with the manufacturer’s website indicating that an average driver can expect to save 20 to 40 percent while the safest drivers could cut insurance costs by up to 60 percent. According to Tesla’s website, they’re able to offer reduced premiums because “Tesla uniquely understands its vehicles, technology, safety and repair costs, eliminating traditional insurance carriers’ additional charges,” reflective of the manufacturer’s “active safety and advanced driver assistance features which come standard on all new Tesla vehicles.” (More information about Tesla Insurance is available at tesla.com/support/insurance.) Seems logical and sounds like a great deal for the vehicle owner...but what does the introduction of Tesla Insurance mean for Texas collision repair facilities? ABAT is keeping a close eye on the situation as it develops. ABAT President Burl Richards finds the topic intriguing. “It’s interesting when you’ve got an automotive manufacturer that’s going into the insurance industry because
shops that want to follow OEM procedures and properly repair vehicles are constantly fighting for the consumer and trying to get proper indemnification. I’m curious to see how a manufacturer that prides itself on these technologically advanced vehicles will behave in this respect: Are they going to put profits on insurance first - or are they going to take care of the customer? What’s more important?” Although the rollout just happened in October, Richards also has concerns related to a letter he received in early 2020 which indicated the insurer would be paying a reduced rate to Tesla-certified shops, such as Burl’s Collision Center in Henderson. “We’ve invested in a lot of training and equipment to obtain certification, but my posted rate is my posted rate. I don’t charge more to repair a Tesla than I do any other vehicle, yet this letter said they want me to charge less. I have a problem with that. Now, Tesla builds an awesome vehicle, and we’re proud that we’re certified to repair those vehicles, but regardless of who the insurance company is, an insurer is merely the bill payer – they have no right to dictate what rates a repair shop charges to safely and properly repair that vehicle.” Late last year and early in 2021, the Texas Department of Insurance (TDI) approved the insurance forms submitted by Austin-based Redpoint County Mutual, the underwriter for Tesla’s Texas insurance program; however, the TDI’s approval holds little weight with Richards: “I’d be curious to know if the TDI ever rejects anybody. I’m not surprised or impressed to learn that they approved it.”
16 NOVEMBER 2021 Texas Automotive
by Chasidy Rae Sisk
“Looking into this is my top priority right now,” added ABAT Executive Director Jill Tuggle. “We’re currently in the research phases, but as we learn more, we’ll determine whether we need to talk to the TDI or the attorney general - or if we need to consider taking legislative action.” For now, ABAT is waiting to see what impact Tesla Insurance will have on members and the Texas collision repair industry as a whole. “It’s a wait-and-see game,” Richards acknowledged. “I honestly don’t care who the insurance company is as long as they pay for all the OEM-recommended processes and procedures to properly indemnify our mutual customer, and we hope that Tesla Insurance will pay for all the necessary processes and procedures that they recommend as a manufacturer. But we also need to see what they want to do with the Labor Rates because their job is to pay the bill, not set the shop’s rate. I’m not okay with them trying to force me to lower my rates, and I know I’m not the only shop concerned about that.” “So, we know what we hope they’ll do, but it’s going to be a few months before we really know how it’s going to go down.” Stay tuned to Texas Automotive as we plan to monitor this situation over the next few months, and we invite readers’ feedback as Tesla Insurance settles into your market. Please email me to let me know what you’re seeing: chasidy@grecopublishing.com. TXA
17 NOVEMBER 2021 Texas Automotive
Ask The Expert
by Robert L. McDorman
Can a Policy’s Right of Appraisal Resolve the Salvage Value Dispute between the Insurer and Insured? Dear Mr. McDorman: I own and operate a collision facility in North Texas. I attended your presentation at ABAT’s Texas Auto Body Trade Show about “Repair or Replace Liability Realignment and the Insured’s Contractual Rights.” Each month, you help several of our clients resolve loss disputes with their insurance carriers. When the insurance carrier deems a vehicle an economic total loss, I routinely see Auto Claim Specialists increase our client’s total loss settlement by thousands of dollars; however, I don’t recall ever hearing you mention if the insured can invoke their policy’s Right to Appraisal to contest a carrier’s assigned salvage value. Can the dispute between the insurer and the insured over the salvage value be resolved under the Right to Appraisal? Thank you for the referral of your clients to us over the years and for your excellent question. Yes, the salvage value dispute between the insurer and the insured can be resolved through the policy’s Right to Appraisal. Just like you referenced above that you routinely see your client’s total loss settlements increased by thousands of dollars, we routinely see salvage value disputes resolved through the Right to Appraisal for thousands of dollars under the carrier’s factored salvage value. The carrier arrives at their salvage value using a similar method as that used by market valuation firms to determine the adjusted vehicle value. Most carriers use Pro-Quote software to calculate the salvage value. The Pro-Quote valuation tool arrives at the salvage value by using the adjusted vehicle value listed on the market valuation report combined with the cost to repair. The Pro-Quote valuing methodology is extremely subjective - it’s not a science. In some instances, the valuation error is significant enough to impact a carrier’s settlement decision, and when that occurs, the Appraisal Clause can be invoked to arrive at a fair value for the salvage. The spirit of the Appraisal Clause is to resolve loss disputes fairly in a timely and cost-effective manner. It is unfortunate that
insurance carriers are still not giving proper respect to this matter. Some have finally taken notice and now routinely participate in appraisal demands, but others remain remarkably obstinate. The under-indemnification in total loss and repair procedure claims in Texas continues to run rampant. Besides the higher settlements for total loss clients averaging 28 percent above the carrier’s undisputed loss statement, we have also reduced clients’ out-of-pocket expenses by an average of 90 percent on repair procedure disputes. These under-indemnification percentages are staggering and harmful to Texas consumers and shops! Please call me if you have any questions relating to the policy or covered loss. We have most insurance policies in our library. Always keep in mind: A safe repair is a quality repair, and quality equates to value. I thank you again for your question and look forward to any follow-up questions that may arise. Sincerely, Robert L. McDorman TXA
18 NOVEMBER 2021 Texas Automotive
Robert is a recognized Public Insurance Adjuster and Certified Vehicle Value Expert specializing in motor vehiclerelated insurance claim resolution. As the general manager of Auto Claim Specialists, Robert expertly leads this National Public Insurance Adjuster Agency, which is currently licensed in over 25 different states and specializes in providing automotive-related claim liquidation techniques, strategies, and motor vehicle valuation services to all parties, including individual consumers, body shops, auto dealers, repair facilities, towing and storage operations, lenders, finance companies, banks, legal professionals, governmental agencies and others. The firm’s consistent success can be attributed to Robert’s 35-plus years of automotive industry knowledge, practical hands-on experience, and multiple certifications, including licensure by the Texas Department of Insurance as a Public Insurance Adjuster. Auto Claim Specialists clients can absolutely trust that they will be provided with analytical, sophisticated, state-of-the-art, comprehensive, accurate, unbiased, and up-to-date data and information that all parties can rely upon as both factual and objective. Robert can be reached at (800) 736-6816, (817) 756-5482, or AskTheExpert@autoclaimspecialists. com.
Fair settlements through knowledge and negotiation! We are experienced in negotiating claims with insurance companies. We have teamed up with Vehicle Value Experts for access to the best vehicle valuing tool available. Together, with the best knowledge and the best negotiating skills, we can ensure a fair settlement on your auto claim.
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771 East Southlake Blvd. Southlake, TX 76092 817-756-5482 Fax: 866-550-0484 Toll Free: 800-736-6816 claims@autoclaimspecialists.com
• Over 25 years of front line skilled knowledge & hands-on practical experience involving automotive mechanical repair
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Vehicle Value Experts is a unique Consultant Firm
that specializes in Insurance Total Loss Market Evaluation Reports; Mechanical and Body Shop Estimates and Finalized Motor Vehicle Repair Evaluations; Diminished Value Assessment and Claims as such and Motor Vehicle Fair Market Value Reports. 19 NOVEMBER 2021 Texas Automotive
Founder Robert McDorman
INDUSTRY ADVICE ASK MIKE: How Do We Empower AND Educate Our Customers before There’s a Problem with Their Insurer? This month, we “ASK MIKE” to share his thoughts on how shops can better educate consumers on proper repair procedures before a problem arises with their insurer. We at Texas Automotive hope you find the 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. Texas Automotive: There are many issues that could come up between a body shop and an insurer during the repair process. Disputes over parts usage, proper procedures and payments immediately come to mind. How can shops educate and empower consumers before a repair so they know what to expect and will be less frustrated or angry if problems arise? Mike Anderson: First off, I’d like to start by quoting Ryan Taylor from Bodyshop Booster: ‘People are more afraid of making a wrong decision than they are of spending money.’ When a customer first contacts us, whether it’s via phone or in person, it’s important to establish that we’re the right choice to fix their vehicle. We must gain their trust. In addition, we also need to understand that when it comes to dealing with customers, competence leads to confidence. By using credible sources to show that we’re competent, we build confidence with the vehicle owner. Think of it as a triangle that represents time. Most people spend very little time with the customer at the beginning, and that triangle gets wider at the bottom. We need to spend more time with the vehicle owner, proving that we are a competent and trusted source to fix their vehicle. There are several ways to do that. Obviously, online reviews matter. Today’s customers have a ‘trust and verify’ mentality. In the past, many customers took a dealership’s or insurance company’s recommendation at face value. That actually hurt shops that were not DRPs. Even if today’s customers receive that recommendation, they still go online and do their homework. So, you need to position yourself with good online reviews. When that customer first reaches out to us, we need to educate them on our competence and credibility. For example, if you’re a certified shop, you may say, ‘Hey, Mrs. Jones, I’m sorry
that you wrecked your Nissan, but the good news is we’re one of only 32 shops out of 600 in this state that have met the training and equipment standards to be Nissan-certified, meaning we have advanced training on fixing your car.’ The key words are ‘advanced training,’ because that separates you from everyone else and makes you special. When the customers came on-site to drop off their vehicle or to get an estimate during my days as a shop owner, I liked to ask for their permission to get their owner’s manual from their car; then, I would review that owner’s manual with them and point things out. For example, I’d tell them what their owner’s manual said about seatbelts or seat calibrations. Doing that helped to establish that I was credible. If you do that and then call them down the road to tell them that the insurance company won’t pay for X, Y, or Z, it’s not as much of a shock to them because you’ve already established that you’re very knowledgeable about their vehicle. I don’t think that you should tell them over the phone that they’re going to have to pay out of pocket, because that’s going to scare them off. You need to get them through the door so you have a chance to prove your competence to them. That way, if at some point you do need to tell them that they need to pay for something out of pocket, you’ve already sold them on why you’re worth it and why you can be trusted. TXA: To be honest, I sometimes see consumer-facing messaging that some shops have on their Facebook pages and elsewhere that would turn me off if I were unfamiliar with this industry. For example, I’ve seen some shops essentially say, ‘Your insurance company is going to rip you off, and this is how we’re going to help you.’ Reading that would make me want to go to another shop; it would make me feel like I’d be gearing up for a fight when all I want to do is get my vehicle repaired. The shop’s heart may be in the right place, but stuff like that could end up doing more harm than good to their image. MA: I don’t think it’s smart to badmouth an insurance company. We get upset when they do that to us, right? Instead, we need to use factual documentation to educate consumers. For example, if you come in with your Toyota, I can show that you need to get your seatbelts inspected, and then I’ll explain that we have the
20 NOVEMBER 2021 Texas Automotive
by Mike Anderson
training and the access to the procedures to do that. If the insurer denies it, I’ve already educated the consumer about why it’s important for it to be done – especially if it’s in regard to safety, so we now have the consumer asking the insurer for that inspection. I think we need to build more presentations and point-ofsale materials that we can use to educate the consumer on why these processes are vital. TXA: COVID-19 has obviously presented some barriers to this, but community outreach is another good way to educate consumers before problems arise. MA: Marketing is making sure people know who you are before they even drop off their car. When I had my shops, we offered Open Houses for car clubs,
which was an opportunity to educate the members of these clubs as to what they should be looking for when selecting a collision repair facility. We showed them the difference between an OEM part and an aftermarket part. When we would ask if anyone had been in an accident, somebody would inevitably raise their hand. We’d hook up a factory scan tool to their car and find things wrong with it, explaining ‘This is why certain things need to be done.’ We’d also offer our services if they ever needed a guest speaker at one of their car club events. There’s a great website, motionu. com, that shows you all of the different car clubs and car club events across the country. You can search by zip code, and there are hundreds – if not thousands – of leads to help you find car enthusiasts to educate so they become advocates for you and your business.
21 NOVEMBER 2021 Texas Automotive
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). TXA
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