Sharing information is the key to minimizing liability and maximizing pay for collision repairers, attorney Erica Eversman asserted during an April 18 presentation at the Sheraton Station Square in Pittsburgh.
Eversman, who is chief counsel at Akron, Ohio-based Vehicle Information Services, added that the lack of information within collision repair is “the biggest problem in this industry.”
“The insurers have done a fantastic job intimidating the collision repairers to not collect [information], to not get together, to not discuss issues about their businesses,” Eversman said. “And that’s something that we all have to get over.”
In addition to sharing “a lot more information,” Eversman urged body shops to engage with the collision repair community by joining groups such as the Alliance of Automotive Service Providers of Pennsylvania, which hosted the presentation as part of the Collision Industry Conference.
“I have never seen any industry as fragmented as the collision repair industry,” Eversman asserted.
Underscoring her points with legal cases showing the lengths to which insurers will go to avoid culpability when repairs go wrong, Eversman told repairers to “make certain you properly document everything you do during a repair.”
Preferably, repairers should include that documentation in their blueprints, she added.
Eversman also offered a list of “musts” for collision repairers. You must:
- Write your own damage analysis.
- Not change your damage analysis to meet the insurer’s, unless you made a mistake and the insurer’s estimate is correct.
- Not delete items the insurer refuses to pay for from your final invoice.
- Have the non-paid items (the “deficiency”) on your documents to prove you’re being underpaid. These can be written off as bad debts later, if necessary.
- Develop standard operating procedures for documentation.
- Stand by your determination.
Among the cases that underscore why proper documentation is critical for collision repairers, Eversman pointed to Cook v. State Farm, a class-action lawsuit in which the Kentucky owner of a collision-damaged vehicle alleged that State Farm’s estimate understated the cost of a proper repair. The motorist experienced a number of problems with her vehicle after picking it up from the repair shop.
“In essence, State Farm said, ‘Well, if only the body shop had told us that they needed to do this procedure or that they needed more money, of course we would’ve paid for that,’” Eversman explained, offering her interpretation of State Farm’s defense. “And of course we all know that was a lie. Because we all know the insurers spend a lot of time talking about what they don’t pay for and how they’re not going to pay for things.”
When insurers push back on repair costs, Eversman offered this advice: Demand to see the portion of the customer’s insurance policy showing that the policy doesn’t cover a specific repair procedure. On a related note, she suggested demanding to see other repairers’ final invoices and checks when insurers tell you, “You’re the only shop that charges for that.”