As of late, insurance companies have staunchly positioned themselves on the offensive, launching all sorts of new “customer-driven” programs to get them in good with the motoring/car-crashing public.

Insurers being on the offensive, however, puts the repair industry on the defensive, forcing shops to react to whatever insurers throw their way. Problem is, being reactive isn’t as powerful as being proactive. It’s better to anticipate and plan (putting you in a position of power) than to be caught off guard and forced to respond to something that someone else has already done (putting them in a position of power).

Three things happened this month that got me thinking about all this:

1. The Hartford launched a new auto insurance program with disappearing deductibles that rewards consumers financially when they use a shop in the insurer’s direct-repair network. Participating insureds save $100 on their collision deductible when using a Hartford DRP shop. The new program is being rolled out on a state-by-state basis.

Sure, there are a lot of questions surrounding the legality of such a program —“Because what [The Hartford] is doing is directing and wording people to go to their DRPs and you don’t get rewarded if you don’t use that shop, I would say there’s potential for antitrust charges to be brought against this insurer by non-participating shops,” says Erica Eversman, chief counsel for Vehicle Information Systems in Bath, Ohio. But the fact still remains: The program is up and running.
It’s a brilliant steering strategy and will undoubtedly be wildly popular with Hartford insureds. Who doesn’t want to save 100 bucks?

2. Progressive has been opening a new “Concierge” center practically every other day for the past 30 days. I can’t look at the news without seeing another “grand opening.” Concierge is the service where customers deliver their damaged vehicles to a Progressive Service Center and Progressive handles the rest. Whatever shop Progressive chooses to repair the car doesn’t interact with the vehicle owner — at all. As of press time, Progressive operated 42 Service Centers in 17 states.
Progressive is marketing the service as a hassle-free repair: Just drop off your wrecked car and don’t worry about it. Progressive will do the rest. Again, it’s brilliant marketing and is wildly successful with consumers. Who doesn’t want a hassle-free repair?

3. State Farm is preparing a national rollout of its new DRP — Select Service — called a “performance-based” repair program by the insurer. Repairers will have an opportunity to review the new agreement and apply to participate. One of the program’s key provisions requires participating repairers to give to State Farm the lowest rate for every labor or parts discount category. If you choose to give no discounts, that’s fine with State Farm. But if you do give them, State Farm wants them … all of them.

In theory, the new State Farm agreement should be prompting shops to reevaluate the cost of their current DRPs, selectively eliminating those that cost the most and produce the least profit. Shops should also view this as an opportunity to raise their rates, using State Farm as the reason. Unfortunately, most shops aren’t doing any of this. They’re simply signing on and extending all their current discounts to State Farm.

In marketing the program, State Farm is saying it extends a higher level of service to vehicle owners. Customers will receive such things as guaranteed completion dates, wash and vacuum of repaired vehicles, and pickup and delivery service. Again, brilliant marketing. Who doesn’t want a guaranteed completion date, a clean car, and pickup and delivery?

Its those three insurer moves — all happening in the same month — that got me thinking and wondering: What have you, as a shop owner, done lately to market your business to your customers? Are you as aggressively pursuing your clientele as insurers are theirs?

If not, you’re forever going to find yourself on the defensive, reacting to the latest, greatest insurer scheme, rather than proactively running your business — on your terms.

Georgina K. Carson, editor