The California Assembly is considering a bill that would prohibit insurers from suggesting a specific repair shop unless the claimant expressly requests a referral or the claimant has been informed in writing of the right to select a repair shop.
A.B. 802 also states that if a claimant accepts the insurer’s recommendation, the insurer must send the claimant the following written notice within five days: “We are prohibited by law from requiring that repairs be done at a specific automotive repair dealer. You are entitled to select the auto body repair shop to repair damage covered by us. We have recommended an automotive repair dealer that will repair your damaged vehicle. If you agree to use our recommended automotive repair dealer, we will cause the damaged vehicle to be restored to its condition prior to the loss at no additional cost to you other than as stated in the insurance policy or as otherwise allowed by law. If you experience a problem with the repair of your vehicle, please contact us immediately for assistance.”
A hearing for the bill is slated for March 30.
Last year, Gov. Arnold Schwarzenegger vetoed S.B. 1167, an anti-steering bill that would have required insurers to ask policyholders if they’ve chosen a repair shop prior to suggesting one. The failed bill also stipulated that the insurance commissioner form a task force to study issues addressed by Insurance Code Section 758.5.
Currently, the California Department of Insurance is considering proposed additions to the state’s anti-steering regulation that would prevent an insurer from discussing DRPs or an alternative facility if the claimant informs the insurer that he or she has selected a specific repair facility. The rules would also prevent an insurer from raising questions about the quality of the repair facility selected by the claimant. Click HERE to read more.
