Jan.24, 2018—The Iowa House of Representatives has introduced a bill that would ultimately make a consumers choice of an automobile repair facility be up to the state.
Under the section, it will prevent insurers or its adjusters from requiring claimants to use a specific shop for repairs or claims. The bill is also said to prevent steering or providing incentives to claimant for using an insurer-recommended shop.
The bill, HSB 529, will not apply to to shops that exclusively provide auto glass replacement and repairs or glass products.
In its writing, the bill addresses DRP programs.
“If an insurer has a direct repair program, the insurer, upon request, shall provide to a claimant, without prejudice or bias, a list of all automobile repair businesses or locations that are reasonably close or convenient to the claimant and willing to provide services and that meet the insurer’s criteria for participation in its direct repair program …” according to the bill.
An insurer will not be able to limit its DRP list of repairers unless a particular shop does not meet certain criteria, which will be outlined in the bill.
However, its market price strategy remains similar to what is accepted today, stating that the price is set between the insurer and the policy holder or repair facility.
