To get things off with a bang, let me ask, “Why is steering bad?” But before I get any shoes thrown at me, let me first inform you of several facts about steering that I’ve gleaned from studying it for way too many years.

Good vs. Bad

First, steering has always existed in the collision repair industry in some form or another. Second, there seems to be two types of steering: good steering, where a repairer is the recipient of the steering, and bad steering, where the work is directed away from another repairer.

Another fact: what the collision repair industry has termed “steering” occurs in other industries as well. For example, the referral programs on the homeowner’s insurance side. But what we call steering would be more accurately termed “deceptive referral.” Sociologically, it could also be referred to as “behavior modification through misleading statements.” These misleading statements are not necessarily untrue, but often fail the test of full disclosure.

So, I ask again, “Is anything wrong with someone referring a customer to your door?” Think about it: Don’t you at some point during the day refer someone to another business?

Nothing Will Change

Considering how long steering has been around, the answer to the question, “Will there ever be a change to the system where free choice by the vehicle owner is a given?” is easy: probably not.

The reason is because deep down, even those who are the most radically opposed to steering practice it almost every day. Also, it’s endorsed and practiced in different degrees by everyone. Finally, insurers have spent hundreds of millions of dollars researching and developing DRP referral programs, and they’ll spend just as much to maintain the status quo.

There isn’t one person in this industry who doesn’t like to have a job referred to him or her. Some shops’ business plans specifically mention word-of-mouth as a legitimate marketing strategy. Sorry, but for those of you who are heading off to get a rope, horses and guns, the newsflash is that this, in slang terms, is what you call steering.

Everyone gets upset when deceptive things are said or half-truths are used because this reflects negatively on their businesses and results in vehicle owners going to other shops. This is deceptive referral, and I believe everyone can agree this is not a positive thing. This is what we’re really opposed to, isn’t it?

Even repairers on preferred lists who think they’ll get work referred to them get steered against…and quite often, it’s done by those who claim to have those repairers on their preferred lists.

What You Don’t Know

So now we can hopefully agree that there are two conditions in steering: one where we get work referred to us, and one where we get work “deceptively” referred away. What’s not so evident is that these two things may occur to the same facility.

Most shops have no way of knowing the number of jobs they didn’t get because of deceptive referrals. The only incidents they know about are the jobs that are towed out of the shop, or when the customer came in with a driveable vehicle and said, “I want you to do the work,” and then never came back. Or the ones where the shops have signed work orders and still, the vehicle owners are “persuaded” to take their vehicles elsewhere.

Is it a reach to say that most repairers would agree that if negative comments weren’t used to influence the vehicle owner, there would be less volatility attached to steering? The practice would still not be accepted, but it would not be as harshly viewed.

We all know why consumers are so easily misled. They think they have to listen to their insurer. In some cases, they’re told where the vehicle is going to be repaired, and if they don’t do as instructed, they’ll have to pay for what the insurer says it doesn’t owe. Does that sound like the co-pay in the healthcare industry?  

Insurers say this doesn’t happen and that the customer always has a choice, but for those who have been “given the choices,” we know that in some cases customers were coerced or scared into making a different choice than they would have otherwise made. For those who don’t believe this, there’s some oceanfront property for sale in Arizona I need to talk to you about. Whether this coercion is encouraged at the local level, a supervisory level or from the top, it’s one of the most unethical practices in the industry today. It’s like being the lone chicken in the chicken coop with two foxes and voting on what’s for dinner. Is that a free choice?

Many insurers have strict word tracks that their claims reps must follow when working with vehicle owners. These word tracks have all been scrubbed by insurers’ legal eagles to a “fare thee well” about how the customer always has the right to choose. Choose between what? What they’re told by the insurer, or accepting the uncertainty of not being informed of all options?

When many insurers find their numbers down on DRP penetration, they send out word that they better get the percentages up or else. That motivates call center management to “crack the whip” to increase referrals. The means by which that happens and how it happens is vague, but suffice it to say it works. So the numbers go up, and you wonder what the claims rep did that they weren’t doing before the “mandate.” Did they simply put more emphasis on getting the insured or claimant to “accept” their kind offer of assistance by offering a siren song of guarantees, lifetime satisfaction with the repair, shorter cycle time, better quality, “Your shop isn’t on our approved list,” etc.?