Insurance Steering-The Bad & The Ugly
The new rules prohibit insurers from making untruthful, deceptive, or misleading statements to consumers that unreasonably influence a consumer’s right to select the repair facility. These new regulations complement existing state consumer protection laws that prohibit insurance companies from requiring that repairs be done in an insurance company-chosen shop and guarantee that consumers have the absolute right to select where they have their vehicles repaired. The new rules also provide guidelines for reasonable timeframes for insurers to inspect damaged vehicles and identify what constitutes unreasonable distances in cases where an insurer requires the consumer to travel to obtain a repair estimate or have a vehicle repaired.
“Consumers who suffer from collision damage should not be misled by insurance companies or forced to wait weeks for an inspection in order to steer them away from their chosen shop and into insurer-contracted repair shops just so the insurance company can save money at the expense of proper and safe repairs,” said Commissioner Jones.
These new regulations follow the recently approved Auto Collision Repair Labor Rate Survey regulations, which set forth standards for insurers, which, if followed, will ensure that auto body repair labor rate surveys are accurate and reliable so that insurers pay the reasonable and proper amount and consumers are therefore not paying out-of-pocket for collision repairs.
The Office of Administrative Law (OAL), which independently reviews all new regulations, approved the Commissioner’s regulation yesterday. The regulation goes into effect by operation of law on January 1, 2017. However, these newly adopted regulations are part of the Fair Claims Settlement Practices Regulations, which contain a delayed compliance date in order to give insurers additional time to comply. The compliance date for the Anti-Steering in Auto Body Repair regulations is March 12, 2017.