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 Posted: Mon Feb 18, 2008 7:11 pm Post subject: Questions directed to the Missouri Department of Insurance |
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I submitted several questions to the department of insurance and got a pretty gobblety gook reply back from them and posted it on different message board.
An enlightened attorney that has written a concise autobody repair law dicitinary that covers all fifty states responded with the following replies.
There is a basis for the terminology of supplement depending upon whether the state involved has any anti steering language or statutes and whos's estimate of repairs prevails in a given state.
Response: The following answers are based upon my knowledge, and information contained in the text AUTO BODY REPAIR LAW IN THE UNITED STATES-ENCYCLOPEDIA OF LAWS (2007)
para 5 page 1: Your reference to 20 csr 100-1.050.(2)(E), should be instead to 20 MO ADC 100-1.050(2)(F). [SEE TABLE OF STATUTES Encyclopedia p 509. This Administrative Code Section provides that when the insurance company elects to repair and prepares an estimate of the cost of automobile repairs the estimate shall be in an amount for which it may reasonably be expected damages can be satisfactorily repaired. If the insurer designates a specific repair shop, the company must cause the automobile to be restored to its condition prior to the loss.
Paragraph 2 page 2. An estimate written by the adjuster must be written to the standard set forth in the Missouri regulation, above. If the scope of the estimate ends up to be less than an amount needed to satisfactorily repair the loss a supplement for newly discovered unknown damage is prepared. The method of approval by the insurer is discussed in ENCYCLOPEDIA Section S9 [supplemental repair]. If a teardown is required, an estimate containing the cost of the disassembly is given to the client. ENCYCLOPEDIA Section T1 [teardown] These documents are prepared, as you know, prior to the final invoice. Paragraph 3 page 2. The insurer fails to properly pay for repairs if the settlement amount is less than what is needed to return the car to its preexisting condition prior to the accident. ENCYCLOPEDIA Section P4 [pre-existing condition]. Assuming the licensed professional is accurate in its estimate and the insurer is not accurate, enforcement is by the insured. This can be by appraisal, or suit depending upon the terms of the policy. ENCYCLOPEDIA Section A5 Appraisal and Physical Damage Appraisers. Para 5 page 2. If the estimate agreed to by the customer contains the disassembly charges along with the repair charges, the customer who decides not to have the repairs performed, owes the shop the cost of repairs up to that time. Some states such as North Carolina have specific enactments on this subject. ENCYCLOPEDIA Section S9 [Supplemental claim p 439-440. The North Carolina enactment comports with common sense and law. The customer 'authorized' the work up to termination which included the disassembly expense.
Paragraph 5 page 2 of your letter. The repair shop is required in most states [not Missouri] to 'prepare an estimate'. See ENCYCLOPEDIA Section E3:9 p197-200 [states requiring estimates listed]. The license or certificate issued to the repair shop does not require that the shop owner have expertise in the market value of vehicles. The insurer decides whether a constructive total exists. ENCYCLOPEDIA Section C10 [Constructive total]. This is part of the insurer's option under the terms of the auto policy's collision coverage.
Paragraph 6 p2 of your letter. The legal remedy for the insured is appraisal. This remedy is usually inadequate as the expense is usually greater than the disputed amount. As discussed in the introduction to the ENCYCLOPEDIA page vii: "Unless the auto body repair industry changes its economic and political relationship with the insurance industry it will, as a whole, remain dominated by the insurers."
Paragraph 8 page 2. In some states, Insurers are required to report results to the regulatory agency which results must include names and addresses of the repair shops, the total number of shops surveyed. ENCYCLOPEDIA Section S10 [survey]. Most states do not have such requirements. The insurer would not have to produce the survey relied upon.
In a state containing an 'anti-steering' statute, the higher estimate of the independent shop would prevail as long as the charges are reasonable. This is based upon the reasoning that if the DRP estimate prevailed over a higher reasonable amount this would be a form of steering, outlawed by the statute or regulation of the particular state. ENCYCLOPEDIA Section S5 [Steering] In a non-anti-steering state such as Missouri the DRP estimate or the insurer's estimate will prevail. Gaston v Founders (2006 Ct.App. Illinois) 847 N.E.2d 523 discussed in ENCYCLOPEDIA Section D6 [Direct Repair Programs p169-170.
Paragraph 9 page 2. If the 'cost of repair' is less than is needed to return the car to the pre-loss condition, or not based upon an accepted based methodology or market survey that determines a fair and reasonable market price for similar services, the insurer cannot pay such low amount. If the insurer can accomplish the proper repair by paying one price to shop one and another to shop two there is no violation. The insurer owes no contractual duty to the repair shop. Its only duty is to the insured. see ENCYCLOPEDIA Chapter 1 [Who is the Customer of the Auto Body Repair shop]
In my opinion your response from the DOI would be as set forth above.
I apologize for any misspellings.
Your questions were quite insightful.
For more information about the text AUTO BODY REPAIR LAW IN THE UNITED STATES - ENCYCLOPEDIA OF LAWS, see Brucecornblum.com
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MikeoftheOzarks
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| Posted: Mon Feb 18, 2008 7:44 pm Post subject: |
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Earlier in this thread Mike said something about negotiating being "unlicensed practice of law" and tcope (I think) said it happens all the time.
I am at a loss here ... what's being "negotiated" ?
Parts ? Rates ? Methodology ? Prices ? |
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thinkerbelle
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| Posted: Mon Feb 18, 2008 11:06 pm Post subject: |
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| Quote: | goodnatured Posted: Sun Feb 17, 2008 1:06 pm Post subject:
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I would hope that in any case my insurance company would step in and help me if they thought the bill was excessive. First off if I did not or the insurance company did not agree with the estimate from the beginning doesn't a second oppinion on costs or take it to another garage come into play here so that both the insurance company and the consumer is protected? I would only expect to pay my deductable after repairs. I would hope that my insurance company would be knowledge about what a fair cost is in repair, surley they have a formula on how to figure these things out, where the everyday consumer would not.
This is the way that I am interpreting this thread, hope it makes sense on the way that I understood the thread. |
goodnatured,
Re-read Point 1.
Point - 1. The *consumer* has an agreement with the Repairer to repair their auto as discussed between the repairer and the car owner.
If you did not agree with our estimate of repairs would you be having your auto repaired at my shop?? Of course not..!
But, you would still have a reference estimate to compare with the insurer's opinion of what it may cost to have your auto repaired.
FK,
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| Posted: Tue Feb 19, 2008 7:02 pm Post subject: |
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| Quote: | Where oh where in any of My Posts does it say I write up a repair Bill before *all* the Repairs are *Completed*??-!!
Where oh where in any of My Posts does it say I do NOT write an estimate?? And then.... just below you Quote my comment about writing as complete and accurate an estimate as I can?? |
| Quote: | | Does this make sense?? |
This entire thread makes less and less sense to me as I can't tell one "guest" post from another!
The initial post was made by "Guest" taken from who know where and then there are replies by "Guest".
Plus everyone's avatar changing in each post is not helping the issue.
Anyway... I did state the following:
| Quote: | | If I understood correctly (might be in error as I think posting names are changing), you said that you don't write supplements. If not, how do you explain this in your post: |
(who wrote what was _quote_ in the opening post?)
My request.... if your going to post more then one time on ampminsure, please register (it's free and painless) and choose an avatar. Thanks for your consideration. |
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tcope
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| Posted: Thu Feb 21, 2008 7:07 pm Post subject: |
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[quote] tcope
Senior member
Posted: 19 Feb 2008 19:02 Post subject:
| Quote: | :
Where oh where in any of My Posts does it say I write up a repair Bill before *all* the Repairs are *Completed*??-!!
Where oh where in any of My Posts does it say I do NOT write an estimate?? And then.... just below you Quote my comment about writing as complete and accurate an estimate as I can?? |
| Quote: |
Does this make sense??
This entire thread makes less and less sense to me as I can't tell one "guest" post from another!
The initial post was made by "Guest" taken from who know where and then there are replies by "Guest".
Plus everyone's avatar changing in each post is not helping the issue.
Anyway... I did state the following:
Quote:
If I understood correctly (might be in error as I think posting names are changing), you said that you don't write supplements. If not, how do you explain this in your post:
(who wrote what was _quote_ in the opening post?)
My request.... if your going to post more then one time on ampminsure, please register (it's free and painless) and choose an avatar. Thanks for your consideration. |
tcope
I agree that this chronological Posting format can be confusing. Especially with the more complicated Topics which get broken into somewhat more detail orientated Sub-Threads.
About the Guests: From the start I've signed all of my posts with FK, at the end. I also registered for the very first Post I made. Then an error (who's I don't know - likely mine) would not allow me to Sign-in, forcing me to remain a Guest for several days. A short while ago "Lakemen" resolved the problem and I've been able to Post as FK, ever since. So when looking at older posts check for FK, at the end, if its not there, its not my post.
I understand your thoughts on the confusion, It seems to requires more time to sort through the list of posts attempting to figure out who is saying what to whom, than it takes to type a response. ??!! But that is the Sites format and I have no control of it.
About the AVATARs: from what I can see with my limited time at this Site. They appear to change at random every time I re-read a string of responses. (the responses stay the same, just the Avatars change) Yet for some that post here the Avatars stay the same.??
Maybe we could get the Site manager or someone else with knowledge to explain the system to us?
Is there anyone that can Help??
FK, |
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FK
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| Posted: Fri Feb 22, 2008 12:51 am Post subject: |
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| Quote: | Where oh where in any of My Posts does it say I write up a repair Bill before *all* the Repairs are *Completed*??-!!
Where oh where in any of My Posts does it say I do NOT write an estimate?? And then.... just below you Quote my comment about writing as complete and accurate an estimate as I can??
And,
No matter how hard you try........ you can not spin a "Final Bill Written after all Repairs have been completed" into being a Supplement. |
If I understand your posts correctly, you write up an estimate prior to working on the vehicle. The estimate is very close to what the repairs will end up costing as you are very good as what you do and take the time to go over all the damages. Also, you acknowledge that your final bill may be different from the estimate, albeit, only slightly.
Then you don't agree with the 5 Points post that you quoted? It states the following:
| Quote: | | I don't do supplements, I do Final Bills and give them to my customer to pay in full. |
Or perhaps this whole thread is a difference in opinion on what a 'supplement' is. A supplement would mean something had been written prior. As a supplement also changes the amount, obviously an "estimate" had been written. I guess you could call it a 'final bill' or a 'supplement' but it's really the same thing. Insurance companies call it a supplement as it's an addition to what _could be_ a perfectly good (final) bill and that it's actually an _addition_ to the initial amount given. Insurance companies _don't_ write 'estimates'... shops write these. As the insurance company is not making the repairs. Their document is a listing of what repairs they are _paying for_. This about that... it actually makes sense. So I guess if we all agree with that, then shops don't write "supplements"... but loosing the terminology, it's all the same thing.
To sum up many posts I fail to see why anyone is up in arms about the relationship between the insurance companies and body shops. As far as I'm concerned, we both work together toward a common goal... getting a vehicle repaired. At the end of the day we don't have to agree on how that should be done and at what cost... it's all good. But we do need to work together as professionals. If one side insists on ignoring the other, it's not going to change anything... it's only going to make work more difficult.
Repair shops can work however they want and charge what ever they want. No one is making them do any differently. But on the other hand, most shops (body shops) live and die on insurance work. Meaning, you can act as mentioned above, it's your right... but at the end of the day if you don't want to work with the carrier, you will probably loose a loose a lot of business. You can read that as if the carriers are playing god, but that is not what I'm saying and it's _not_ the case. The carriers I know of are always willing to talk over repairs with the shops. The carriers will try to come to a meeting of the minds. Sometimes the carrier won't give an allowance for what is being asked. Sometime they will. The same should be expected of the repair shop. For those that think they don't need to work with other business, more power to you. I hope and trust that you will do well for yourself.
It might be appropriate to mention where I'm coming from... the carrier I work for does not use AM parts... mainly OEM and reconditioned OEM. Sometimes I will write salvage parts but not often (I'm under no pressure and I just don't feel like clicking that button most of the time). Most body shops in my area charge $40-$42/hour. I pay $42/hour. Some charge $44. I pay $42/hour... it does not matter if the shop charges $40... I'm out to pay an average rate... not pick and choose to save a buck. I mostly re-write shops estimates... meaning I simply use the repairs they write down. Sometimes my appraisals are more, sometimes they are less. Does it make sense that I pay more then the shops estimate? Yup... as mentioned, I don't pick and choose what to go by just to save a buck.
Also... I SUCK at writing apprasials. |
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tcope
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| Posted: Wed Aug 24, 2011 1:02 pm Post subject: Try article |
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I really liked the article, and the very cool blog
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