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Maine Gov. Paul LePage vetoed legislation that aimed to clarify Maine’s anti-steering law.
Maine law prohibits insurers from steering consumers to a particular body shop for collision repairs. Even so, some shops in the state believe that the law could be stronger, as they’ve seen insurers find ways to circumvent the anti-steering language.
Unfortunately, their efforts to pass stronger anti-steering legislation came up short, as Maine Gov. Paul LePage vetoed Legislative Document 1540, and the Maine Senate sustained LePage’s veto.
“An Act to Protect Consumers’ Freedom of Choice in Auto Collision Repairs,” sponsored by Maine Rep. Scott Hamann, would have required insurers to provide the following statement if recommending a particular shop:
“You have the legal right to choose a motor vehicle collision repair shop to fix your vehicle. Your policy will cover the reasonable costs of repairing your vehicle to its pre-accident condition no matter where you have repairs made.”
On May 31, the Maine House of Representatives passed the anti-steering measure by a healthy margin. LePage vetoed the bill.
On June 21, the House overturned LePage’s veto, with two-thirds of the House voting in favor of the bill. However, the Senate failed to produce the necessary votes to override the veto.
In a message accompanying his veto, LePage asserted that LD 1540 “micromanages Maine businesses and creates more unnecessary regulations for Maine’s auto insurance industry.”
“LD 1540 appears to be a solution in search of problem,” LePage wrote. “If auto insurance companies were truly steering business toward specific collision repair businesses, this may be a discussion worth having. But over the course of the last nine years, Maine’s insurance bureau has only received six consumer complaints regarding this issue; two of those complaints were that insurers did not direct insureds to shops participating in the insurer’s networks.
“Additionally, the superintendent of insurance conducted a study of the seven largest auto insurance carriers in Maine and did not identify any instances of steering.”
Attorney Bernadette Bolduc Papi and the team at ACME Body Shop in Portland, Maine, spearheaded the effort to get the legislation drafted.
“The insurance companies are interfering with the free marketplace,” Papi testified at a May 10 public hearing on the bill. “Consumers are losing their freedom of choice.”
Hamann, the bill sponsor, testified that steering is a common practice that works well for insurers and body shops – but not consumers.
“This bill is very simple,” Hamann testified. “It seeks to end the practice of steering by banning the company from using either threats or incentives when they choose a body shop after an accident. Furthermore, it requires the insurance company to explain to a customer, through a pre-approved script, that they have the legal right to get the repair done at the shop of their choice.”