If the work is done well, I suppose this might help cut costs (ie, lowers rates — ha ha, as if that would ever happen), but you have to wonder what ancillary issues might arise. You take your car into their center to repair a fender bender and they notice your riding on nearly bald tires. Raise rates for not driving a safe vehicle!
One-Stop Car Insurance Service, Body Work Included
Several insurance companies have decided their old strategy for handling car-damage claims is in need of repair.
Rather than putting the onus on customers to find a body shop, get an estimate and arrange a rental car, Progressive, Geico and others are setting up one-stop service centers to handle every aspect of the claim.
The centers are emerging as a new competitive arena among insurers. And while consumer advocates applaud the new convenience, they also see a conflict of interest.
“The downside is that you’re turning over your car to somebody who has a vested interest in maybe chiseling you out of a couple of bucks,” said J. Robert Hunter, the insurance director for the Consumer Federation of America. Mr. Hunter suggested that customers get an independent assessment of damage and repairs.
This is right up my alley.
1. If all you pay is your deductible, who cares where you get it repaired? As long as you get a rental when in it’s repair.
No conflict of interest. Canada has been doing this for years, it’s called a DRP program (direct repair pro-shop).
The bodyshop has trained staff and uses a computer based estimating system, and are routinely audited.
The insurer adjuster refers the customer to the nearest “Pro-Shop”. By law, the consumer can take the computer estimate and have it repaired anywhere for those $$$.
Over 75% of volume is #1 – repairs that don’t become TL’s (total losses).
The problem is with TL’s. This is where J. Robert Hunter’s comment makes sense.
Otherwise, if you have a 500$ deductible, and 90%+ of accidents cost in excess of 500$, the point is moot where & how it’s repaired.
The Real Deal – recycled parts and similar parts – INSTEAD of OEM parts.
Recycled parts will rust faster, but on a ten year old car, I call that “blending”.
Similar parts are just as good as their over-priced OEM cousins.
So of course, Pro-Shops claims are evaluated, and recycled/similar parts are encouraged, unless there is a backlog.
OEM parts can be ordered in the appropriate color, making repairs faster, even if more costly. Similar parts are primed gray.
My POV – better for the customer – you & me. Trained staff instead of Mom & Pop shop.
Rates? Try the competition and switch every second year – unless you’ve got a record – then you’re screwed.
// No matter what your deductible $$$ is – always ALWAYS
// pay sub-1500$ repairs 100% out of your pocket – don’t file a claim !
// The break-even is probably 1,500$ every 5 years
In my slashies comment . . .
If you save 200$ a year with a 1,000 deductible versus a zero dollar one.
Personally my accident to years driving ration is like 0.0002, why should I pay 20% extra?
Plus, once you’ve filed a claim, your rates go up, and the competitor insurance will know about it if the police was involved (almost always).
If someone hits you, on a public street, that’s different. That guy’s claim will pay for you & his car.
In a private place, like a shopping centre parking – it’s an automatic 50/50. So shake hands, don’t call the cops.
Hit & Run? Get evaluated, and if below 1,500$, pay it out of your pocket, or else (rates way up).
Oh yeah, TL’s, always get a second opinion (another bodyshop). Insurance companies make profit reselling TL’s when it’s a borderline decision.
(like airbag deployment making it a TL based on OEM airbag price replacement – a common one – versus recycled/similar)
If you think this will be a GOOD THING, you are WRONG. The way US companies run thing, you will be forced to use the shop that the Insurance company orders you to. The work will be up to the minimum specifications, and it won’t be guaranteed. If the work is shoddy, try filling a complaint, it will be like the company in “The Incredibles” (“our customers must not penetrate the bureaucracy!”). The shop and the insurance company won’t accept the blame, and the consumers will be screwed…
While I think #3 is unfounded opinion, I can tell you from a number of years experience (hanging out with a crew of steel-knockers) that you will still likely be screwed – a little bit.
American insurors make that little bit extra bit margin by tying bonuses for adjustors to reducing claims amounts. The usual target is 5%. That may not seem like much on your individual claim; but, when you total up hundreds of thousands of claims – it’s tens of millions of dollars.
#2, Mark, I know I had to fight for days with Travelers to get my car off TL. After citing numerous web quotes from sites like Carmax, etc., they finally gave in and fixed the thing. But what a pain in the butt.
I wonder if they would have totaled it if they had their own shops?
Cheese, the only accident in the last 30 years and all I got was a very large deer (missed the doe, just goes to show what kind of trouble you can get into chasing tail) 🙂
#1 & 2 Mark
Very good points and a good system. I have no doubt it would not work here simply because that would require government oversight of the insurance industry and the repair shops. Government oversight costs money and infringes on our freedom.
#6 – Not to mention, it might take the insurance mafia about a week to totally subvert the oversight authority. And their cost to do that would get factored into the next year’s insurance rates.
Allstate has owned Sterling Auto Body Centers for years. What you get is the same goal as the insurance industry itself
“To Spend as Little as Possible”
which equals for you the customer cheaper half-ass repairs cheapest available labor not tho most qualified technicians.
Thats what letting the Insurance Co. own the repair shop gets you.
Something to consider:
Almost all new cars now have black box data recorders. Suppose that the insurance company just happens to decide that they need to look at this information as part of the repairs. I can see them putting the disclaimer in the fine print of the repair authorization to allow just this.
With the information on the black box, they might create a profile on your driving habits and decide that you are a bad insurance risk. For example, you may have taken your new sportscar to the track and it will have recorded excessive braking and acceleration as well as a top speed well into the 100’s. Heck, my new car even has a g-meter as standard equipment that records lateral g’s.
They can tell quite a bit about how you drive your car based on this info. I don’t really want my insurance company to have that data.
#9,Mark T. If you don’t want that black box, just disable it.
http://www.lightsout.org/disable.html
10. Thanks for the tip, BubbaRay. I did not know that it was possible to disable them without making the car undriveable. Unfortunately, my car was not listed on the website you provided.
I did let me know how to disable the stupid DRL’s (daytime running lights) on my GM truck. I will have to test that one tomorrow.
I will have to check the auto forums to see if anyone has successfully disabled the black box on my car. I guess I should have done that already but I thought is was integral to the engine management computer. I equated disabling the black box on a car to removing IE from a Windows machine. It can be done if you don’t mind breaking your machine.
#11, Mark T., I had to get a mechanic named, of all names, Bubba (smartest Mom & Pop mechanic I know) to disable the feeds to the black box on my car, He did and the car functions normally and if anything gets a little better gas mileage. Go figure. Cost me only about $75. I’ll bet the last data in that module is: 2 mph, brakes normal, etc. And he did it in some sort of ‘stealth’ mode, so no ins. company can moan and whine.
Insurance — the greatest scam in the US, I ought to know, I was an actuarial student at one company in DFW many years ago.
Now you can be screwed twice
Well at least they can see you coming.