Florida, Missouri and Maryland supporters remain confident, say 2005 will bring more legislation
Is legislation designed to stop the spread and, in some cases, outlaw insurer-owned shops at a crossroads? Supporters and opponents of this legislation are debating this point after several highly publicized bills died before reaching a vote at the end of their 2003-2004 legislative state sessions.
During the latter part of 2003 and early months of 2004, proponents of legislation controlling the spread of insurer-owned shops seemed to have built up momentum for their cause. Texas had passed the nation’s first law stopping the growth of these shops, and legislatures in states such as Michigan, Missouri, Maryland, Florida and Arizona began working on their own Texas-inspired laws. What a difference several months make.
Beginning with the decision of a Texas judge to temporarily halt enforcement of several portions of the Texas law, efforts to pass anti-insurer legislation have faced a series of setbacks. The Arizona legislature scrapped its bill in committee and decided instead to work on legislation aimed at steering. More recently, bills in Missouri, Maryland and Florida all died in committee. Opponents of this legislation believe these defeats are part of a nationwide trend.
“Regardless of the specifics of each bill, they are all protectionist in nature,” says Bill Mellander, spokesman for Allstate, whose Sterling shops are usually the target of these bills. “When you see the defeat of these bills at the committee level, we believe you’re seeing the wisdom of legislators. We hope they are seeing through the cloud of special interest messages being thrown at them.”
Supporters contend the defeats are no more than temporary setbacks. Bob Redding, Washington, D.C., representative for the Automotive Service Association (ASA) notes, “This is tough legislation to pass. We have strong opposition from some in the insurance industry. Having said that, we think there will be more legislation in the future. It’s on the increase, not the decline.”
Redding adds, “In states where this legislation is failing or stalled, you will see it reintroduced. As information on it gets disseminated to more shops, support is going to grow. You’re also going to see it introduced in states that haven’t seen it before.”
Legislators who introduced the failed bills already have vowed to continue their fight. Maryland Del. Rich Impallaria (R-Md.) remains confident the legislation he sponsored, House Bill (HB) 1124, eventually will be made law. “Even the best legislation fails the first time around,” Impallaria says. HB 1124, which would have required insurer-owned shops to distribute disclosure statements to customers, died in the Economic Matters Committee. Impallaria believes the bill could have a new life in a work group Gov. Robert Ehrlich (R-Md.) plans to assemble in the fall of 2004. The group—to be composed of legislators and representatives from the insurance and auto body communities—will focus on collision repair issues.
In Missouri, Rep. Michael Daus (D-Mo.) is pursuing other means to pass the bill he introduced, HB 818, after it failed to reach a vote in the House Financial Services Committee. Daus hopes to attach HB 818 as an amendment to HB 1233. If that effort fails and he’s reelected in the fall, Daus plans to reintroduce the bill. He believes the necessary support is already in place to pass the legislation. “We had widespread bi-partisan support for the bill,” he says. “Part of the trouble may have been with the timing. We did a lot of work on tort reform this session. It was a bad time to be ‘picking on’ the insurance industry.”
Daus adds that HB 818 never reached a vote only because committee chairman Blaine Luetkemeyer (R-Mo.) never permitted it. “He runs an insurance company,” says Daus. Luetkemeyer did not return messages left by ABRN. Biographical information on the Missouri legislature’s official Web site lists Luetkemeyer as an insurance agent.
Timing also may have played a part in the failure of legislation on both sides of the Florida legislature. HB 1503 stalled in the Insurance Committee. Now listed as “temporarily deferred,” HB 1503 won’t receive any more attention until the next session. Its Senate counterpart, Senate Bill (SB) 2692 died in the Judiciary Committee after making its way through the Banking and Transportation committees. Glenn Lang, the staff director to the Senate Judiciary Committee, says SB 2692 arrived in committee too late to be put on an agenda.
Rep. Richard Machek (D-Fla.), sponsor of HB 1503, predicted his bill would suffer some initial setbacks when he introduced it in January. “It usually takes legislation like this two or three years to pass,” he said.
At press time, similar legislation was still alive in legislative committees in Iowa, Michigan, Minnesota and Hawaii. Mellander believes if recent history is any indication, these bills could be in trouble.
Redding refuses to concede any ground. He says, “This isn’t going away. In 2005, we’ll see even more action.”
