Insurance Insider (17)
The "Insurance Insider" is a corporate-level executive with a Top 10 auto insurer in the U.S.. Although he needs to remain anonymous, he will answer questions emailed to him in future columns. Got a comment or question you’d like to see him address? Email him at
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‘Survival of the Fittest’ Also Applies to Collision Repairers
Written by Insurance InsiderThe collision repair industry has too many body shops. I’m not sure anyone would seriously dispute that. The sooner we can rid ourselves of 15,000 body shops, the better all of us will be. Yes, it’s true, all of us will be far better off. This includes insurance companies, vendors, body shops themselves and consumers.
To view a PDF of this article please click HERE.
How can we make this happen at a faster pace? That may be beyond the limited scope of this mastermind, but it wouldn’t be an Insider article without a recommendation or two, so buckle up and get ready.
The car manufacturers should further develop their certification programs and join together as one voice to educate consumers at the point of purchase. “If your car is in an accident, you must take it to an OEM Certified Repair Facility to guarantee a proper repair. Taking your vehicle to a body shop outside the Certified program could result in an improper repair and compromise your safety.”
Sadly, that statement isn’t some trumped-up idea to scare people. It’s a fact and the motoring public should know that while there are more than 35,000 body shops in the country, too small a percentage are prepared to repair aluminum, identify substrates, weld “exotic” metals and use proper-sectioning procedures.
Getting a Guess-timate From the Real Experts
Written by Insurance InsiderBefore you can begin repairing a vehicle, you need an estimate. It’s the easiest part of this whole deal, right? You have a computerized estimating system that allows you to accurately document everything that is needed to fix the car.
To view a PDF of this article please click HERE.
Some say it’s so easy that you can do it remotely by merely looking at a picture. Now that does sound easy! Almost as easy as going fishing with the “Pocket Fisherman.” Ah, the memories. For those not old enough to remember, every man in the world wanted one of those little babies nestled in their glove box.
Why do I reference the inspirational and ageless Ron Popeil and his company, Ronco? It has nothing to do with getting a sales commission. I mention him because he made the impossible seem possible. The trivial and difficult became simplified and logical.
I believe that repairers and insurers view estimating through the never-invented “Ronco Goggles.” (Sorry for another pathetic Popeil reference. If you can’t tell, I’m a big fan and proud owner of an original Pocket Fisherman and Mr. Microphone.)
If estimating is so easy why is it the most misguided, challenged and subjective part of the process? There is an easy answer: It’s not really that easy. Repairers and insurers argue all the time about the estimating process. I’ve heard repairers say, “The cost to repair the car is the cost to repair the car. Insurance companies are just trying to write a low-dollar estimate. Let the experts write the estimates and repair the vehicle.”
Does that sound familiar to anyone? It should.
Legislating the “Bible” Not the Answer for Shops Tired of Being Told “No”
Written by Insurance InsiderWhen the repair industry (later than most) finally moved into the 21st century and started writing estimates by computer, shops and insurance companies alike likened computerized estimating to the advent of the washing machine. Why a washing machine?
To view a PDF of this article please click HERE.
Some of you might be old enough to remember the days of washing your clothes by hand. Although I never had the pleasure, I recall my parents talking about the painstaking process of washing clothes in a bucket when they were kids. It was an arduous process that consumed a lot of your time if you did it right.
I did write estimates by hand and I can assure you that it too was a long painful process. What made handwritten estimates worse was having to go back and try to translate what you scribbled while clutching a clipboard.
If you are a member of Generation X or Y (or any other letter of the alphabet), you probably can’t relate to these old-man war stories. That said, I will try to offer a correlation you can appreciate. That’s what we’re supposed to do with the younger generation, right? Entertain them and cater to them and give them a ribbon just for participating even if they finished in last place. So for them: Handwritten estimates is like having to get up and change the channel on the TV because you can’t find the remote control.
Sure, OEMs Set the Standard, But Who Fills the Gaps Left by OEMs?
Written by Insurance InsiderThe debate continues to rage: What is the standard for collision repairs? Who develops the standard? Is it possible to deviate from the standard? If you can deviate, what entity can provide an alternate to the standard?
To view a PDF of this article please click HERE.
As such, people, committees, associations, not-for-profit organizations and corporations are lining up quicker than adults outside of Toys R Us on Black Friday to offer their two cents on the subject. Sadly, most of their opinions aren’t worth a single copper Lincoln penny.
Why not? Because most of those offering an opinion are basing their decision upon something other than being experts on the topic.
I’m not professing to be an expert or proficient enough in repair methodology to offer an opinion worthy of your consideration. While that may be the most humble thing you will ever read in one of my articles, I am going to give you my opinion anyway. The way I see it, if you are reading and listening to alleged industry experts weigh in, why not an insurance executive who has never actually repaired a vehicle? Maybe I’m the best person to offer an opinion because I don’t stand to gain anything.
Although I’ve never repaired a vehicle, don’t discredit the wisdom I’m about to impart upon you. Sometimes the best ideas come from the most unlikely of places. Do you think Moses knew what was going to happen at the top of the mountain? If you happen to be a good church-going boy or girl, you know that is where Moses received the Ten Commandments. Who could have guessed sectioning procedures were even an issue back then?
ASRW Responds to Insider’s Comments in his Columns: ‘Can NACE Survive as a Traveling Regional Trade Show?’ and ‘Industry Undecided Which Organization Will Prevail’
Written by ASRWIn light of the excellent working relationship between ASRW and Autobody News, we wanted to comment on the ongoing ‘Insurance Insider’ column. We understand these are op-ed pieces and are written from the author’s point of view. However, the two articles we’ve seen—Can NACE Survive as a ‘Traveling Regional Trade Show? and Industry Undecided Which Organization Will Prevail in NACE vs. SEMA” each contain several inaccuracies.
Our attempts to contact the ‘insider’ regarding these statements received standard automated replies. We wanted to bring the following inaccurate statements to your readers’ attention:
‘Can NACE Survive as a ‘Traveling Regional Trade Show’? October 20, 2011 (online); November 2011 (print)
● Article states: “Aside from the fact there weren’t a lot of people there, which made it easier to navigate the show floor, the smaller event meant my feet were intact after a few days of walking.” – Although the size of NACE has contracted in proportion to the size of the collision industry since the late-1990s, ASRW 2011 had an increase in attendance of 18%.
● Article states: “They assembled a committee of industry experts that were supposed to help guide them to “NACE: The Next Generation.”—Although the ‘NACE: The Next Generation’ committee does not exist, we do solicit feedback from industry experts, attendees, exhibitors and prospective participants when making decisions that affect the future of ASRW.
● The article references a vote at the CIC meeting in early 2010 as the catalyst as to where the fall CIC meeting would take place.—Although votes occurred at this meeting, the relevant vote took place at the CIC Planning Meeting in January of 2011 and the results (holding the meeting in conjunction with NACE or SEMA) were separated by 1 vote.
‘Industry Undecided Which Organization Will Prevail in NACE vs. SEMA’ – November 23, 2011 (online); December 2011 (print)
• Article states: “[NACE] staked their claim as the undisputed ‘Collision Industry Trade Show Champion’ after 2011.—While we have never made this particular claim, NACE remains the only event dedicated to the professionals within the collision repair industry.
● Article states “SEMA is an upstart show.”—SEMA is not an upstart show. According to www.semashow.com, it is “the premier automotive specialty products trade event in the world,” and has been in existence since 1966.
● Article states: “NACE lost the sale, and Round 1 of the ‘Battle of the Century’ last year went to SEMA.” According to www.semashow.com, SEMA’s audience consists of approximately 60,000 automotive enthusiasts in the automotive, truck and SUV, powersports and RV markets. Unlike SEMA, NACE’s audience has been and remains the professional collision repairer.
We consider Autobody News to be a great partner/supporter, and we appreciate the on-going coverage and support we consistently receive. We welcome the opportunity and are always available to provide the anyone – including the ‘insider’ with factual information regarding ASRW.
Thank you,
ASRW Show Management
Hanley Wood Exhibitions
Industry Undecided Which Organization Will Prevail in NACE vs. SEMA
Written by Insurance InsiderYou can ring the bell as Round 2 of the “Battle of the Century” has ended. Yes, “NACE vs. SEMA, Part 2” was very different from the prior year. The battleground changed from a Las Vegas faceoff to an Orlando vs. Las Vegas showdown.
To view a PDF of this article please click HERE.
This year’s winner is in the eye of the beholder. NACE (the International Autobody Congress and Exposition) and its sponsoring organization, the Automotive Service Association, have staked their claim as the undisputed “Collision Industry Trade Show Champion.”
Meanwhile, the Society of Collision Repair Specialists has teamed up with SEMA and announced their contention to be the new “Heavyweight Champion.”
So who was this year’s winner? I personally think it was a draw—with one exception: There was a clear loser. I’ll give you a hint. It’s an eight letter word that begins with an “I” and ends with a “Y.” The collision industry is divided and stuck supporting two trade shows. The NACE and SEMA divide is all about “I” (rather than “we”) and the industry is holding the bag and left asking “Y?” So how and why is the industry losing in a fight it never asked for?
I was one of a small percentage of people who had the good fortune and fortitude to attend both shows. I experienced both the aging NACE and the upstart SEMA show. I was forced to dedicate two-plus weeks to accomplish what normally would take me one week. I successfully met with all the individuals and companies that requested my presence and knowledge.
Can the Collision Industry Support Two Major Trade Shows?
Written by Insurance Insider“The Insider” is an auto insurance company executive who wishes to remain anonymous. This column reflects solely the opinion of The Insider in his unvarnished view of various issues impacting the collision industry.
Can NACE Survive as a ‘traveling regional trade show’?
To view a PDF of this article please click HERE.
Well, it’s that time of year again: lights, slots, dice, scantily-clad women, lavish parties, casinos and NACE? Actually, it’s not—NACE is already over. In case you missed it, NACE (the International Autobody Congress and Exposition) took place in early October in Orlando, the first time it moved from Las Vegas in more than a half-dozen years.
Yes, I was one of a handful of people that showed up to support the industry’s longest-standing national trade show. I have missed only four of the 29 of these annual extravaganzas, and I wasn’t about to let a trip to sunny Florida deter me from attending.
I have to admit, I was apprehensive about spending the money and time to attend two shows this year. . How this small industry can support two national trade shows (NACE and the SEMA show in November, which I will discuss in my next column) is beyond comprehension. In fact, I would say it’s not possible.
Here’s my best guess: We will be back to one national industry trade show in the next three years. There’s no way that the large companies buying booth space will continue to throw good money after bad. Even aside from the poor economy, national trade shows like NACE are a dying breed. Yup, even the mighty dinosaur eventually went extinct.
Let’s Get Some Independent Testing to Move the Parts Battle away from Sandbox Bickering
Written by Insurance Insider“The Insider” is an auto insurance company executive who wishes to remain anonymous. This column reflects his opinion and not necessarily that of Autobody News’ staff or contributors.
Since the arrival of the first non-OEM crash part from overseas a few decades ago, the debate has raged on over the value, safety and benefit of using these parts. It’s important to note that the rage hasn’t come from the consumer (you know, the person that actually has the parts installed on their vehicle). So if the consumer doesn’t seem to care, who does and why?
To view a PDF of this article please click HERE.
The people who seem to care the most are the companies trying to sell parts. The reason is pretty simple: money. So the next time you see a press release, a simulated crash or a reaction to test with a reciprocating saw involving crash parts, be advised that what you are witnessing is a demonstration of big business fighting for market share and profitability.
I’m sure there are some safety concerns that need to be addressed. But if there were a significant enough problem, I would surmise that a lawsuit involving a few high-powered attorneys illustrating the faultiness of non-OEM crash parts and the resulting death of a vehicle’s occupants would have happened at least once in the past few decades. If you are aware of one, please send it to This e-mail address is being protected from spambots. You need JavaScript enabled to view it . Lacking that, what we really have are two kids who can’t play in the same sandbox.
The end result is a lot of propaganda, rife with chest-puffing, staged testing, wasted money, name-calling and an increased cost of parts to the consumer in order to offset the needless expenses—despite the car manufacturers trying to lead you to believe that it’s all in the name of safety.
Ridiculous DRP Requirements? Guess Why They’re Asking
Written by Insurance InsiderIn a previous column, I offered some of my thoughts on the decision of the Society of Collision Repair Specialists (SCRS) to make the Farmers Insurance “Circle of Dependability” (COD) agreement public, and to question some of the requirements of that direct repair program agreement.
To view a PDF of this article please click HERE.
In doing so, SCRS said that “the industry is often disadvantaged by restriction of communication from participants of these program.”
I am little confused as to where the disadvantage lies? Okay, I am very confused. Explain to me the disadvantage. What would the advantage be if there were no restrictions? Shops should be deciding what is best for their individual business. That decision shouldn’t be predicated upon whether or not your competitor thinks it’s a good idea to participate. While SCRS makes a lot of good points in their press release, this is one it needs to reconsider. Go ahead and publish all of the major insurance carriers direct repair program agreements and see what it changes. Would it really improve the industry or help shops?
That said, here are a few more of my thoughts—some of which may surprise you—from an insurer’s perspective on the COD agreement and SCRS’s concerns about it.
The agreement states that Farmers has the right to inspect a shop’s books to validate and audit files to ensure proper payment and compliance with the program requirements. Why insurers continue to infuse themselves into the body shop’s business in this way is beyond me. It’s wrong and they have no business inspecting your books.
Hate the Way the Strings Are Pulled? Don’t Become an Insurer’s Puppet
Written by Insurance InsiderThanks to a suggestion emailed from a reader of this column (J.W.), here are my thoughts and insights on the Farmers Insurance Circle of Dependability (COD) direct repair program agreement requirements.
To view the full text of this article with photos please click HERE.
The Society of Collision Repair Specialists (SCRS) recently published the agreement, saying it felt that some of the requirements warranted being made public. As an insurance company executive, I often wonder what the association’s true intent is. My guess is that it’s not because they were trying to foster good relations with insurers.
Personally, I think it’s a childish reaction to a big-boy problem. Hopefully, they feel they accomplished their mission. I can assure you that it doesn’t build trust or confidence with any insurance company or organization looking to build common ground with the association.
But enough of that rant. What I’d like to focus on is some critique of the concerns about the requirements that SCRS raised, and my view of the stupidity surrounding agreements like this one. Suffice it to say, no one shall be spared the rod.
SCRS states that insurance carriers have continued to increase pressure over repair shops to obtain the quickest and cheapest repair. Does that really sound like a bad thing? Anyone operating a for-profit business should be doing the exact same thing. Don’t body shop owners pressure their staff and technicians to perform the quickest, most economical repair?
Telling the Tale of the “Neutral Information Provider”
Written by Insurance InsiderIn the Middle Ages, civilians didn’t have computers, television, radio, Pong, or even ping-pong. So what did they do for entertainment? One tradition was story-telling. The great thing about telling such tales was that you were forced to use your imagination. Although it’s important to note that you weren’t expected to believe everything that was being said.
To view the text of this article with photos please click HERE.
Fairy tales often have a happy ending and tell us about a world where anything is possible. The tale I’m about to tell you is about the “neutral information provider.”
This tale begins in the 1980s, around the time of the first electronic estimating system. For decades prior to the advent of electronic estimating, shop and insurers slaved away preparing handwritten estimates. Along came a brilliant man named Maximillion. He believed that there was a faster and more accurate way to prepare an estimate. He thought he could equally help body shops and insurance companies through the use of technology. Because this new idea would benefit both parties, he thought he would be able to sell this new product to two different customers. In fact, he could charge the same amount to each. It was the beginning of the now over-used term “win-win.” All he had to do was find a way to take the data from printed estimating books and put it in an electronic format.
