Legislative Lowdown: - BodyShop Business

Legislative Lowdown:

Florida – Senate Bill 2692, which prohibits insurers from owning or acquiring interests in motor vehicle repair shops, has been filed in the Florida Senate and referred to the committees on Banking and Insurance; Transportation; Judiciary. If S.B. 2692 passes, it’ll become effective July 1.

S.B. 2692 provides civil penalty for specified violations; prohibits insurers from owning or acquiring interests in motor vehicle repair shops except under specified circumstances, prescribes conditions for contracts between insurers and certain motor vehicle repair shops, requires certain motor vehicle repair shops to give notice to customers of relationships with insurers, prohibits specified acts by insurers regarding motor vehicle repair, etc. Amends Ch. 559.

Florida’s House Bill 1503, the Motor Vehicle Repair Act provides civil penalty, provides for administrative fine for certain violations, prohibits insurer interests in certain motor repair shops, provides for favored facility agreement presumption, provides notice requirements for certain motor vehicle repair shops, and requires certain agreements to be negotiated and executed to prevent conflicts of interest, etc. Amends Ch. 559. If passed, H.B. 1503 is effective upon becoming law.

Call your state senator today and ask their support of S.B. 2692 and H.B. 1503.

Maryland -House Bill 1124 authorizes the Insurance Commissioner to have authority over the business practices of specified autobody repair facilities, requires an employee of specified facilities to provide specified policyholders with a specified notice, prohibits the notice from being part of an estimate or other form, requires the policyholder to sign the notice, requires specified facilities to keep a copy of the notice with specified repair records, etc. Delegate Rick Impallaria, a body shop owner and Republican from the Baltimore area, introduced H.B. 1124. Contact Delegate Impallaria toll-free at (800) 492-7122, ext. 3334 or by email at [email protected].

Michigan – The Automotive Service Association (ASA) and the Automotive Service Councils of Michigan (ASC-MI) testified recently before the Michigan Senate Banking and Financial Institutions Committee on Senate Bill 819, Insurer Owned Repair legislation. Repair facility owners from throughout Michigan packed a Senate hearing room to show support for the legislation, according to ASA.

The legislation prohibits insurance companies from owning or acquiring a repair facility in the state of Michigan. If the legislation is passed, any insurer that has ownership of a repair facility must divest itself of that facility within two years of the effective date of the legislation. S. 819 was introduced by Sen. Laura Toy, R-Livonia and has 16 co-sponsors.
Its companion bill in the Michigan House of Representatives, H.R. 5460, was introduced by Rep. Ken Daniels, D-Detroit. The House bill allows insurers who own repair facilities as of Jan. 1, 2004, to retain their ownership.

“ASC-MI opposes insurance companies having an ownership interest in automotive repair facilities and views such ownership as being in direct conflict of interest,” says Ron Meyer, president of ASC-MI. “It eliminates the checks-and-balances system that assures consumer protection. Direct ownership raises barriers for the consumer and forces them to choose the path of least resistance to assure prompt attention to their repair needs.”
“We are now at a point where some insurers are determined to eliminate the last line of defense for the vehicle owner: the independent repair facility,” said Bob Redding, ASA’s Washington, D.C., representative, in his testimony. For more information on ASA, visit www.asashop.org.

Missouri – H.B. 818 – Auto Insurance. This bill prohibits auto insurers from acquiring an ownership interest in an autobody repair shop. Any insurer that already has an ownership interest must free itself of that ownership by August 28, 2007. The bill also prohibits an auto insurer from compensating any person for referring an insured to an autobody repair shop owned by the insurer. Violation is an unlawful merchandising practice. Read the bill text at http://www.house.state.mo.us/bills041/bills/H.B.818.htm.

H.B.1528 – Prohibits automobile insurers from recommending that a motor vehicle be repaired at a specific automobile repair shop; prohibits auto insurers from requiring that a motor vehicle be repaired at a specific auto repair shop, unless the claimant expressly requests a referral or the insurer informs the claimant in writing of his or her right to select an auto repair shop; and prohibits insurers from limiting the cost of the repair to the estimated cost provided by the insurer’s repair shop. Sponsored by Rep. Luetkemeyer, H.B. 1528 has a Proposed Effective Date of Augusts 28, 2004. The bill has been referred to the Financial Services Committee.

Read the entire bill at http://www.house.state.mo.us/bills041/bills/hb1528.htm.

Michigan – Senate Bill 819, Insurer Owned Repair legislation was discussed in the Michigan House Senate Banking and Financial Institutions Committee in March.

Body shop owners from all over Michigan packed a Senate hearing room to show their support for this legislation. The Automotive Service Association (ASA) and the Automotive Service Councils of Michigan (ASC-MI) testified before the committee supporting SB 819.

California – SB 1500, a bill to close loopholes in the state’s proof of auto insurance law has been introduced by Senator Jackie Speier (D-San Francisco/San Mateo).

Anti-Steering Spotlight

Any of the following acts or practices by an insurer, if committed in violation of section 44-1539, shall be an unfair claims settlement practice:

Requiring the insured or claimant to use a particular company or location for motor vehicle repair. Nothing in this subdivision shall prohibit an insurer from entering into discount agreements with companies and locations for motor vehicle repair or otherwise entering into any business arrangements or affiliations which reduce the cost of motor vehicle repair if the insured or claimant has the right to use a particular company or reasonable available location for motor vehicle repair. For purposes of this subdivision, motor vehicle repair shall include motor vehicle glass replacement and motor vehicle glass repair.

Insurers can have network or DRP in Nebraska.

Writer Mike Causey is president of Causey & Associates, a full-service government relations firm. Causey lobbies for consumer rights issues and represents The Independent Auto Body Association (IABA), The North Carolina Glass Association (NCGA), Automotive Service Association of North Carolina (ASANC) and Motorcycle Owners Legislative Coalition. Causey is a Registered Lobbyist in North Carolina, South Carolina and Virginia.

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