What's Good for the Goose: A List of Preferred Insurance Companies - BodyShop Business

What’s Good for the Goose: A List of Preferred Insurance Companies

Take a gander at this idea: I have a list of preferred insurance companies that I steer my customers to. Not only have we been the reason many customers changed insurance companies, but we deal more now with the insurers we like — and less with the ones we don’t

It’s a national pastime for people in the collision repair industry to bash insurance companies. And most of the insurance companies deserve some verbal abuse.

But what about when an insurance company does the right thing?

For several years now, I’ve been rewarding well-behaved insurance companies by giving them referrals. I took one of their tactics and turned it around on them. They have their list of preferred shops, the shops they try to steer their customers to. I have my list of preferred insurance companies, the insurers I try to steer my customers to.

I’ve included the list in the disclaimer section of my estimating software, and after printing, I staple it to the top of the estimate so the referral list is the first thing my customer reads when he looks at it.

We ask every customer about their insurance coverage, and if he has a carrier that’s not on our list, we explain the benefits of switching. We’re careful not to bad-mouth the insurance companies that don’t make our list, but we do explain the differences.

This system works well. We’ve converted many of our customers, which has helped to shape our business so that we deal more now with the insurers we like — and less with ones we have to fight with to get fair treatment. As time passes, we see fewer appraisers who couldn’t estimate their own weight, let alone a wrecked automobile, and more appraisers who know how to meet our bottom line and keep us recommending their companies to our customers.

Didn’t Make My List
Our free advertising has been increasing the customer base of those few decent insurance companies. Unfortunately for the rest of the insurers — the ones not on my list — they’re experiencing the opposite. Only the billions they spend in advertising every year can keep the premiums coming in.
The intense advertising Progressive has been doing is catching some of my prospective customers. Recently, I repaired a vehicle belonging to a Progressive insured. When the customer came in for an estimate, we explained exactly what would happen and how Progressive would handle her claim. She was amazed at how accurate we were.

They tried to steer her to one of their DRP shops. When she refused, they told her they couldn’t guarantee our work. When she insisted that we were repairing her car, they told her we were difficult to deal with and that she would probably end up paying more than her deductible.

Progressive’s estimate was several hundred dollars less than ours. They refused to negotiate the labor rate and told her we were the only shop charging these high rates. So she shopped around — and couldn’t find another shop (except for the DRP shops) that would repair her car for Progressive’s estimate.

We repaired her car, she paid her deductible plus the difference Progressive shorted her on the labor rate, and she promptly switched insurance companies.

Progressive thought they won. But they lost someone who could have been a loyal customer.

In another incident, when a claimant’s vehicle was hit hard in the rear, Progressive refused to budge on the labor rate but offered my customer three times the labor rate difference for “emotional damages.” Can you believe these idiots? They felt it was worth $2,000 to keep me from collecting $600 as a labor rate concession. Progressive also feels it’s worth thousands of dollars in legal fees to defend a small-claims action against them for a few hundred dollars in labor rate deficiencies.
Companies not on my list — like Progressive — know it, and they know why. Because every estimate I write has my referral list on it, every company that sees one of my estimates also sees my referral list. It has to have some impact, even if it’s just cause for conversation around the water cooler or in a claims meeting.

On Our List
Contrasting the psychotic behav-ior of Progressive is an insurance company that recently handled a claimant with such care and professionalism, the owner of the vehicle switched insurance companies immediately.

Not too long ago I had a repair being paid for by Travelers. It was a third-party claim. The customer was initially going to go through her own insurance company (Allstate … ugh) because she thought Allstate would take better care of her. I convinced her to let the other person’s insurance take care of the claim.

In my area, Travelers is outstanding. The appraiser from Travelers met my bottom line without argument. The vehicle was repaired, supplement taken care of immediately, rental bill paid in full for a comparable car, and the whole experience for her was painless and professionally handled. When the vehicle owner picked up her car, she told me she was in the process of switching insurance companies — to Travelers.

This woman is now paying a slightly higher premium, but she figured they handled an adversarial situation with such class that Travelers’ service to paying customers must be incredible. Travelers took a costly situation for them and turned it into a profitable one. They’ll probably recover every penny they paid out on that claim, and much more.

Another one of the companies at the top of our list is State Farm. Now I’m sure there are some of you who don’t like State Farm for one reason or another. But in the past several years, State Farm has topped most surveys done by those in our industry as the best insurance company to deal with. They’re still the only insurance company that does a labor rate survey every year and sets their standard labor rate based on the results of their survey. And their Service First program is the benchmark by which all other programs should be judged.

How many of you have picked up the phone and called the claims manager and thanked him? How many of you fail to fill out the survey form and fax it back to State Farm?

There’s nothing more motivating to a person than recognition for their efforts and a slap on the back for a job well done. Don’t think of an insurance company as some large, faceless, uncaring, unthinking and unfeeling entity. An insurance company is just a group of people working together toward one goal. The decision makers are people too, and they enjoy positive feedback.

It’s obviously costing State Farm money to conduct business the way they are now, and unless they receive some positive benefits, they may not see any reason to continue. These benefits can come in the way of new customers generated by referrals from you or as just a quick phone call telling the claims manager how much you appreciate the way they treat you and your customer fairly.

Every insurance company on my referral list knows they’re on my list. And they know why they’re on the list.

Use Your Influence
Body shops can have a lot of influence on which company their customers purchase insurance coverage from. It’s up to you, as a shop owner, to educate your customers about what they’ll receive from their chosen insurer. And they need to know that going for the cheapest rates may end up costing them a small fortune if their insurance company refuses to pay the costs needed to repair their car properly.
So take a break. Pick up the phone and call the claims manager at every insurance company that you think treats you and your customers fairly. Tell them you appreciate their fairness. Let them know that you’re referring your customers to their company for insurance coverage — and encourage them to keep up the good work.

Writer John Shortell is body shop manager at Secor’s Collision Technology in New London, Conn. He’s been in the collision industry for more than 20 years and has developed computer software for body shop scheduling called BodyShop Schedule Pro, for subletting towing called Tow Bill Helper and for printing estimates in dollars called Dollars & Sense. For more information, visit www.bodyshopsolutions.com.

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