The Insurer Made Me Do It? - BodyShop Business

The Insurer Made Me Do It?

Historically, our industry’s associations have been about as highly regarded as government employees — and thought to work just as hard. But during the past few years, some associations — especially on the state level — have become much more active, vocal and unified, making it possible for them to actually accomplish something.

But with this newfound activism comes responsibility. Part of an association’s role is to educate its membership, but to do that properly, the association itself needs to be informed. I say this because I recently received a flyer that went to member shops from a body shop association that’s really trying to do the right things. Member shops were supposed to pass this flyer on to vehicle owners, to help educate them about their rights. The flyer bulleted six points, and as I read the fourth, I got concerned. (I’ve bolded the information below that struck me as inaccurate):

Some insurers will actually tell you that if you take your vehicle to “that shop,” you’ll have to pay extra, out-of-pocket expenses. What they’re really telling you is, “This is all we’re willing to pay.” They already have a direct-repair program arrangement with another shop in the area. What a DRP arrangement for most insurers is: The shop and insurer have entered into an agreement in which the shop agrees to repair that insurance company’s claims business the way the insurer wants the repairs made, which might not be in your best interest. Of course this type of decision is for cost savings only. If the repair facility repairs the vehicle the way the insurance company demands, then the insurer is 100% liable for that entire repair. Again, you the consumer are stuck in the middle. What is the correct and safe way to repair my vehicle?

Because this information just didn’t sound right to me, I consulted Massachusetts collision repair attorney James Castleman to set the record straight …

GKC: If the repair facility repairs the vehicle the way the insurance company specifies, is the insurer 100% liable for that repair?

Castleman: “It depends on the particular state’s law and whether you’re talking about a DRP shop or an independent shop (it’s not clear to me which they’re talking about in the flyer). As an example, in Massachusetts, if you take your car to an insurer’s referral shop, then, by statute and regulation, the insurer has to guarantee the repairs; if you take your car to your own independent shop, then the insurer has no liability, even if the shop does the repairs the way that the insurer says to (although the Wreck Check people might claim otherwise). Generally, the insurer is never liable for work done by an independent shop. Whether the insurer is liable for work done by a DRP or “referral” shop depends on the state.”

GKC: But is a shop ever really off the hook — even if they are a DRP? Aren’t they liable for the repair, too? This makes it sound like the shop has no liability if it repairs the vehicle as per the insurance estimate. But isn’t the shop always responsible for its work? The insurer may also be responsible, but that doesn’t make the shop liability free, does it?

Castleman: “You’re right. Generally, the shop is always responsible for its repairs, whether it’s an independent or DRP shop, and whether or not the shop does the work the way the insurer specifies it wants the work done. In Massachusetts (and some other states), the shop is on the hook even if it does the work the way the customer wants it done, even if against the shop’s advice. Although it might fly in some states, in Massachusetts and some other states, a repair shop cannot disclaim liability under any circumstances and cannot effectively have a customer waive warranty claims against the shop.”

So what does all this mean to you? Bottom line: “The insurer made me do it” excuse doesn’t relieve you of liability. You, as the repair expert, are always responsible for the work coming out of your shop. And you should be.

Georgina K. Carson, editor

You May Also Like

Keys To Making 2023 A Huge Success For Your Auto Body Shop

Stopping daily work to work “on” your business instead of “in” your business is essential in order to deliver change in the new year. 

While you were busy doing your holiday shopping and wrapping gifts, hopefully you were also taking the time to wrap up your business for the year too. Just like you create a list for all of your holiday projects, I create a list of all the things that need to be done to efficiently close out the year and get ready for success in the new year.

Auto Body Consolidation Update: What Will 2023 Bring?

The bull market of consolidation is expected to continue in 2023 even amidst high inflation, rising interest rates and other challenges.

The Great Awakening: Collision Repairers Taking a Stand

Many repairers are now taking a stand, realizing they cannot conduct business the way they used to.

CARSTAR Fort Collins: Process Produces Performance

The new facility that CARSTAR Fort Collins moved into was designed with organization and performance in mind.

Are Collision Repairers Their Own Worst Enemy?

It’s always been easy for repairers to see insurers as the bogeyman that causes all of their problems, but insurers are merely taking advantage of repairers’ lack of business knowledge and acumen.

Other Posts

Are You Ready to ROCK in 2023?

Do you know a “rockstar” in the automotive aftermarket? Then it’s time to nominate them as a Vehicle Care RockStar!

BodyShop Business 2022 Executives of the Year

This year’s Single-Shop award winner is Michael Bradshaw of K & M Collision in Hickory, N.C., and the Multi-Shop winner is Matt Ebert of Crash Champions.

Conducting Collision Business: It’s a New Day

The goal is not to declare war against insurers; it is to declare independence for your organization so that you’re able to provide the highest level of service to your true customers.

Don’t Be Quint: Embrace ADAS and Modern Vehicle Equipment

We can avoid a fate similar to Quint’s in the movie Jaws if we embrace ADAS, technology and training.