Legislative activity focused on collision repair is heating up again around the country. Votes have already been cast in Texas on legislation seeking to ban insurance company ownership of repair centers and the issue will surface in other states. California has legislation pending to ban steering, reform its Bureau of Automotive Repair, license technicians and provide consumers with disclosure on the compliance of repairers with the law. States including New Hampshire, Florida, and Iowa also are considering legislation that affects the repair industry. More activity will most certainly appear in the near future, and repairers must take notice and get involved to ensure their voices are heard on the issues affecting the future of their businesses.On March 6, the Licensing and Administrative Procedures Committee of the Texas House of Representative held a public hearing and approved a bill that would outlaw insurance company ownership of repair centers in the state. The bill, H.B. 1131, is the companion bill of a widely publicized Texas Senate Bill introduced publicly at NACE by Texas state Sen. John Carona (R-Texas).The members of the Licensing and Administrative Procedures Committee voted unanimously in favor of the bill (7-0) with one member absent and one present but abstaining. The battle lines drawn and positions outlined by both opponents and proponents of insurance company investment mirror those that lead to the defeat of the California S.B.1648 that sought a similar ban on investment. Allstate and Sterling representatives have already promoted their business in Texas as protecting consumers from fraud, reducing costs, providing higher quality repairs and customer satisfaction. Allstate representatives said during the public hearing that the collision repair industry is plagued by fraud—a problem it says can be solved by insurance company ownership. The intense focus on the issue of fraud by Allstate is widely seen as a major contributor to the defeat of California’s legislation last year.Proponents of the ban cite two main reasons for their support. The first reason is a conflict of interest regarding the cost of repairs that they believe will put cost before quality. The second is the increase in steering caused by Allstate’s word track that many independent repairers believe paints them in a bad light and that proponents of a ban believe misleads consumers about their right to choose repair facilities.During the hearing, many committee members’ questions centered on the issues of steering and consumers’ rights. Allstate and Sterling maintain that they fully disclose the relationship between the two entities and that they inform customers of their right to choose a repair facility.Beyond Texas, the California legislature has no fewer than five bills before it that impact the repair industry. Notably, state Sen. Jackie Speier, the sponsor of last year’s failed effort to ban insurance company ownership of collision centers, has introduced a bill to ban proactive steering by insurers. These few bills mentioned above do little to highlight the sheer volume of legislation that’s already been introduced or planned for the next several months and how it will have a direct impact on the future of every collision repairer’s business. Rarely has so much legislative activity occurred at the same time with important implications for repairers. If you’ve never involved yourself in the legislative process, now is the time to start. Do some research and find out what legislation is pending in your state or local community. Get involved with your state or local trade association, and find out what its positions are regarding legislation and how they impact your business. Write or call your elected representatives and make your views known.If you don’t, you may wake up one morning to find a dramatically different collision repair industry. Take the time to share your ideas and help shape the collision repair industry’s future.
About the Author
Russell Thrall IIIRussell Thrall III
Former ABRN Editor-in-Chief Russell Thrall, a second-generation collision repairer, has experienced the shop from the bottom up, starting as a clean up person and working his way to assistant manager by age 17. Thrall joined the staff of Chilton's Automotive Body Repair News in 1991 as technical editor and as senior editor in 1992. From 1993 through 2000, Thrall served as editor of Collision Repair Industry INSIGHT. Thrall returned to the staff of ABRN in June 2000 as editor-in-chief of the industry's largest monthly trade magazine. Thrall was a frequent speaker at industry events including the Collision Industry Conference (CIC), NACE, and numerous other local and regional events. He served as co-chairman of the Collision Industry Conference Electronic Commerce committee and is a member of the Board of Directors of the National Auto Body Council.
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