Is It Possible to Have OEM Certifications and DRPs?
Nov. 2, 2021, LAS VEGAS—OEM and insurer representatives stated their cases regarding the realities of shops trying to maintain OEM certifications and DRP partners during an at-times contentious panel discussion on Tuesday during the Collision Industry Conference at the SEMA Show.
During a panel discussion moderated by CIC chairman and LaMettry’s president of operations Darrell Amberson, representatives from Mercedes-Benz, Subaru, CSAA Insurance, Allstate and OEConnection maintained their company positions and at times disagreed with each other’s perspectives.
Are Both Business Models Possible?
Benito Cid, collision manager at Mercedes-Benz, kicked off the discussion bluntly when asked if it’s possible for a shop to be on both programs.
“It’s difficult; I would never say it’s impossible. There are shops that do it, but it’s extremely difficult,” he said. “The background work that needs to be done when you need to prove your point, there’s a lot more time invested in that. Ultimately, from an insurance standpoint, the idea is that they should pay for everything that needs to be done and the shop needs to prove everything that needs to be done. The legwork is the difference.”
Sandee Lindorfer, director at Allstate, disagreed, noting that Allstate has many shops that have OEM certifications within its network.
“Between our network and the OEs, we have more that is in common than we have differences. We want our customers to have safe and proper repairs,” she said. “I don’t think that proof of repair procedures is as great as it was in the past when it was so hard to get repair info.”
Among all the representatives, a common theme of having good communication with industry stakeholders emerged. Dan Tessadri, APD business consultant from CSAA Insurance, often reiterated that for CSAA, removing barriers and allowing for the swiftest route to safe and proper repairs was its top priority.
“If there are repairs outlined by the OE, they don’t need to be validated by our partners. We don’t ask for heavy documentation. It’s in the repair procedures,” he said. “We want to remove those barriers for our partners to process that information quickly. In the end, we want to pay the claim quickly and get the customer back in the vehicle.”
Stricter Oversight to Come
As for the biggest friction points, Cid and Subaru collision certification manager Devin Wilcox agreed that making sure shops are doing “the right thing” and following the repair procedures is the OE’s biggest priority.
“We have an audit process and also an unannounced audit process to make sure shops are doing the right thing,” Wilcox said. “We really hold our network of shops to the highest standards. We have no problem pulling the plug if it’s not right with the shop. If it’s not right, it’s wrong.”
When pressed by Amberson, both Wilcox and Cid admitted they believe further regulation and stricter guidelines from the OEs for their certified shops is on the horizon, which caused concerns this would create even more friction for shops when dealing with insurers.
“We work closely with the OEs and try to come to common ground. … We work together very well the majority of the time,” Lindorfer said. “I think we have to ask our repairers, how do they feel about all these quality checks from outside the business? I don’t know of any other group that has this type of oversight on it. Should the repairer own their repair quality?”
Time to Re-Evaluate KPIs?
That’s where the discussion began to take a more contentious turn as the conversation turned to KPIs and the expectations on shops regarding scorecard metrics.
OEConnection’s Tagliapietra pressed the insurers, arguing that, “some of those KPIs haven’t been updated in 10 years. The repairers are being held to those standards.”
Lindorfer disagreed, saying that cycle time numbers have been updated over the years because of complexity of repairs and they are evaluated regularly.
Tessadri was sympathetic to the repairer plight, but also felt the challenges were too great to completely overhaul the scorecard process.
“ I understand the challenges the repairer faces and I think crafting a subset of metrics may be challenging depending on the ability of the IP,” he said.
Lindorfer agreed, and argued the time is not right for an overhaul.
“The majority of the vehicles we repair are not 2021 vehicles,” she said. “We need to repair the vehicle in front of us. The average age of the vehicle on the road is more than 11 years old.”
Tagliapietra took issue, noting that cars that are even seven years old have OBD-II ports and require a certain level of complexity.
Further Insurer Participation Required
During the Q&A portion of the discussion, CIC attendees pressed all panelists, including from vice president of technical products and programs Jeff Peevy.
“If a manufacturer has a stated requirement, you must be performing those pre- and post-repair scans. Once the manufacturer has identified what the correct activity is, you, as the shop, that is failing to perform that activity will automatically have reached negligence and you will be held responsible if there’s any damage,” he said. “We need insurers to make sure they're on board with making sure they’re paying for the appropriate procedures that the OEs are saying are the right way to fix their cars.
“Just because you did not repair the vehicle for the people who currently own it, does not mean you can’t be held responsible for neglecting to perform repairs that are procedurally necessary, particularly as it relates to scans.”
Ultimately, the conversation ended with SCRS executive director Aaron Schulenbrug thanking the panelists for participating and calling for other insurers, in particular, to make themselves more available.
“There’s a bigger issue here, for this committee in particular: There should be more companies that are willing to agree to the conversation,” he said. “We struggle to find the right people to get on the stage.”