3. UNFAIR PRACTICES – Insurance companies will deny, delay and try to defend and use methods such as steering, totaling and negotiating unfairly. The insurance companies will keep getting aggressive unless shop owners push back.
4. ASSIGNMENTS – Assignments from your customer, the insured, are crucial to obtain and must be legally sufficient. They legally put you, the shop owner, in the legal position of your customer for negotiating and subsequent litigation with insurance companies, if required. Each state may have their own requirements, which must be followed precisely.
5. SHOP SAFETY – Lately, the entire topic of environmental rules and regulations has become extremely important in your day-to-day business. This is particularly common regarding respiratory protection and hazard communication. My suggestion is to issue written warnings to your employees to create what we call informed consent. This can later be used as evidence to prove that legal and sufficient notice of any potential danger has been given to your employees.
Remember, employee safety is a must and proper safety equipment and environmentally acceptable chemicals have to be used, as both Federal and State agencies may visit your shops for inspection. They have the power to commence legal action against your shop, which could lead to fines and even put your permits or license in jeopardy.
6. TOTALING – In their never-ending effort to “tighten the belt,” the practice of totaling, i.e., when insurance companies declare an automobile too damaged for repair when you know that it is repairable. This process obviously saves the companies the expense of parts and labor. The result? You lose business.
Insurance companies have long used the method of favoring certain shops, perhaps in your area, to obtain favorable rates.
Although it is perfectly understandable that any business has an absolute right to make profits, cut expenses and costs and deal with certain companies, they can’t do it by illegall and/or unfair means. That applies to small businesses as well as to the largest companies in the world that have faced scandal or criminal conviction, such as Archer Daniels Midland, Bankers Trust, BP, British Airways, GE, International Paper, Samsung, Sears Roebuck and Company, Tyson Foods, VW, Waste Management and many more.