I want to thank all of the shop owners around the country who have favorably responded to my initial column from last month.
If you have a question or concern about any legal issue that may arise in your business, don’t hesitate to contact me at 1-855-Law-Mann or contact Autobody News.
Although I can’t give legal advice, I can give a general opinion about your issue and point you in the right direction.
In this edition, I want to explain some very basic definitions of terms that you may see me discuss in future columns. You may experience some of the following in your day-to-day business:
1. OEM – This is simply Original Equipment Manufacturer parts and equipment that may be marketed by a manufacturer. However, these parts are assembled and installed during the construction of a new vehicle. They are in contrast to after-market parts, which are subsequently installed, e.g.., Champion sparkplugs, Kinsler fuel injectors, BMP engine blocks.
You have to be careful because many auto parts are sold through multiple brands, causing some vehicles to have non-OEM parts.
This area contributes to much of the litigation that is currently taking place, i.e., the State Farm case that I discussed in my prior column.
Another topic that unfortunately occurs is the situation where insurance companies short shops on payments regarding OEM vs. after-market parts.
Shops should fight back! There have been successful verdicts and settlements around the country on this issue and many others.
2. CAPPING – Watch out for companies capping labor rates and paint materials itemized, such as PaintEx. They may have no legal basis in capping or even outright rejecting your hard-earned payments – they add up!
Gamesmanship by the insurance industry is alive and well, i.e., their latest word game is called a calculator. Why, you might ask? It’s simple and means nothing. PaintEx is a presentation that falls under the gaap rule (generally accepted accounting principles). These are the same rules that every insurance company uses every day.
PaintEx is only one example of many that insurance companies attempt to reject because it saves them money and at the same time takes money out of your pocket.