Chasidy Rae Sisk is a freelance writer from New Castle, DE, who writes on a variety of topics.
She can be reached at crsisk@gmail.com.
For most people, New Year’s Eve is a time to reflect on the past year and make resolutions for the incoming year. Collision repair industry associations have also started preparing for next years by setting their sights on what they can do to improve the industry for their members. Several association leaders shared their New Year’s Resolutions for 2015 with Autobody News.
From record snowfalls in the southern U.S. to a missing Malaysian airplane to the fear of an Ebola outbreak, 2014 was a memorable, if somewhat frightening, year around the world. In the American collision repair industry, 2014 was riddled with lawsuits against insurers’ unfair business practices and other battles for the rights of collision repair professionals, but industry associations still managed to provide some positive experiences for their members throughout the year. As the New Year rolls around, Autobody News asked a handful of association leaders about the most memorable things their associations did in 2014.
On Saturday, August 16, the Atlanta I-CAR Committee held their 6th Annual Rockin’ Car Show at the Hooters restaurant in Kennesaw, GA. Beautiful weather and an excellent turnout of over 55 custom vehicles contributed to a successful event.
The awarded trophies and prizes were donated by local collision repair industry businesses as a show of support for the event. The Atlanta I-CAR Committee also held a 50/50 raffle and a silent auction, raising over $3400. The proceeds from the event will benefit the Collision Repair Education Foundation (CREF), and funds will be used to support GA students.
Over the past six years, the Atlanta I-CAR Committee has donated approximately $100,000 to CREF in funds raised at their annual golf tournaments and car shows. Terry Fortner, Chairman of CREF’s Board of Directors, attended the car show to discuss CREF’s mission with attendees.
For the second year in a row, Travis Peck, lead deejay of Radigital Studios, donated his time and skills to provide music and entertainment at the Committee’s event. He also plans to support the Rockin’ Car Show again next year.
During the Rockin’ Car Show, a presentation was held to award a check to the student who was the winner of the Atlanta I-CAR Scholarship for post-secondary collision education, and both collision instructors from Maxwell High School of Technology were in attendance as well. They also recognized the Skills USA student who received travel expense assistance from the Atlanta I-CAR Committee which allowed him to attend the national contest.
Gerry Poirier, Chairman of the Atlanta I-CAR Committee, states “the committee’s goal is to help replenish our dwindling technician base and our fundraising has been accomplished by the support of the many great collision industry businesses in the area, including shops, insurers, parts suppliers, paint manufacturers and rental partners.”
At 7:30am CST on Tuesday, August 26, attorney John Eaves Jr and Bill Fowler, owner of Bill Fowler’s Bodyworks in Southaven MS, attempted to raise consumer awareness of the national lawsuit Eaves filed earlier this year when they appeared on the Drake and Zeke Show, a popular morning radio show in the Memphis, TN area. The reason for their guest appearance was to explain the lawsuit to consumers and educate them on their rights during the collision repair process in hopes of raising awareness about this important issue impacting collision repair facilities across the country.
Though Halloween is just around the corner, witches, ghosts and vampires aren’t the scariest things on the minds of collision repair professionals across the nation this October; what these experts find terrifying is the amount of undue influence the insurance industry, a third-party entity, exerts on their repair practices and their businesses as a whole.
During the weekend of September 26-28, ASA-IL held their annual Chicago Automotive Network (CAN) Conference at the Hyatt Regency O’Hare in Rosemont, IL. With over 200 participants, including 150 who attended training sessions, ASA-IL’s Executive Director Donna Kelly and Co-Executive Director Deb Bullwinkel deemed the event a success. Kelly notes, “it went really well and was very exciting. It was great to see so many new faces enjoying our jam-packed schedule, and we received a lot of positive feedback on the training we offered and the new venue – many people said they’d definitely be back next year.”
After Louisiana Attorney General Buddy Caldwell filed a lawsuit in August against State Farm, accusing the insurer of illegally forcing LA collision repair facilities to install unsafe parts on consumers’ vehicles, his allusion to these parts as “nothing more than used junkyard parts” created quite a stir amongst professional automotive recyclers across the country who were offended by the derogatory term and connotations thereof.
Michael Wilson, CEO of the Automotive Recyclers Association (ARA), and David Gold, Secretary of ARA and co-owner of Standard Auto Wreckers, quickly took up arms to defend their profession while Caldwell clarified his position as being pro-consumer rather than anti-recycled parts.
Click here to download the PDF version of this article.
Over the past two issues (see August and September Autobody News), industry attorney Erica Eversman has offered some insights into the various types of documentation that collision repair facilities can use to protect their interests and help them obtain proper compensation for work performed. In the final installment in this series on repair documentation, Eversman helps explain the purpose for and how to use the Parts Notice/Authorization and the Indemnification/Hold Harmless Letter, with a few additional documents.
Pro Paint, the largest PPG Platinum Distributor in the Midwest, held their 7th Annual Trade Show on Tuesday, August 12. The event was held at Orchard Banquet Hall and Restaurant in Baldwin, WI. The event offered a variety of vendors demonstrating their products, six educational seminars, and a special guest appearance by NHRA’s John Force.
Repair documentation plays an important role in your collision repair business, but many shop owners are not very familiar with what they need to protect their interests, so I’ve turned to an industry-leading attorney to provide crucial information on what you need to know about documentation in the collision repair industry. Last month, Erica Eversman, Chief Counsel for Vehicle Information Services, Inc. and founder of the Automotive Education and Policy Institute, a non-profit organization geared toward educating consumers, explained how collision repair facilities can use the Authorization to Repair and Repair Contract to receive proper compensation from insurers in legal battles. While those two documents are extremely important, they may not be the only documents you need to successfully pursue a shortpay case in a courtroom. Here, Eversman explains the relevance of an Assignment of Proceeds and Writ of Replevin in these situations.
The purpose of the Assignment of Proceeds is to create a bridge between the insurance company and the collision repair shop, and this is especially important when you have a consumer who is unwilling or unable to pursue proper compensation via a shortpay lawsuit on the shop’s behalf. Though the insurance company owes their customer the duty of indemnity and the customer thus expects their insurer to pay the shop that repairs their vehicle, many consumers simply do not know or care enough to pursue litigation in instances of shortpays. By asking your customers to sign an Assignment of Proceeds, your shop creates a necessary bridge to the insurance company, giving you the right to step into the consumer’s shoes (for purposes of collecting the full repair costs), force the issue and get paid.
The “devil is in the details”, so your first step is going to be hiring an attorney with experience in the collision repair industry who can assist you with properly wording the document. Eversman cautions, “you don’t have the right to sue on the consumer’s behalf for everything, such as diminished value; because you’re only being assigned the rights to proceeds, you can only sue the insurance company to collect proceeds for the repair. You need to understand what this industry is about, clarify exactly what’s going on, and specify which rights are being assigned to you.”
Though a Power of Attorney (POA) would also serve this purpose, customers are less likely to agree to sign this type of document. The problem with the POA is that, while it gives a repairer more power, it is also more complicated, leaving the repair facility with the burden of making all decisions for the customers, so Eversman discourages the use of the POA. While every insurer has an anti-assignment clause written into their policies, most states permit the use of post-loss agreements, making the Assignment of Proceeds a viable option. It also makes sense for the shop to assume responsibility for prosecuting the insurance company, if necessary, since it requires less action on the part of the consumer.
Once you get to the point of pursuing litigation in order to receive proper compensation, you must remember that the burden of proof falls on you, the plaintiff. In court, you should try to avoid allowing the insurance company to present their estimate as evidence because part of your battle entails proving that their estimate is meaningless – as the collision repair professional, YOU are the one with the right to determine how the vehicle should be repaired, while the insurer is merely obligated to pay for the repair, not to control the process (unless the insurance company has elected to repair).
In order for an Assignment of Proceeds to be legitimate, it is imperative that the consumer understand what they are signing, so it is also a good idea to ask your customers to sign a separate document confirming their comprehension of the Assignment of Proceeds. When constructing your Assignment of Proceeds, begin by defining what it is and how it will be used. The purpose of the document is to allow “a transfer of property or other rights from one person (the assignor) to another person (the assignee) which confers a complete and present right in the subject matter to the assignor… Essentially, this means that the assignee stands in the shoes of the assignor,” Eversman explains.
Because the assignment serves as a contract between the assignor and the assignee, it is thus subject to contract law and interpretation. An important item that must be included in Assignments of Proceeds is a definition of the assignable rights which will identify causes of action issuing from a wrong that causes injury to property or from tort by which property is diminished or damaged; both of these are generally assignable. It is also vital to inform your customers that they can assign their right to recover damages to their property without conveying the title to that property.
For an Assignment of Proceeds to be valid, it must contain clear evidence of the intent to transfer rights in addition to a description of the subject matter in question. The assignment must be clear and unequivocal and be noticed to the obligor. While there are no formal requirements regarding the verbiage used in this document, the language must clearly indicate the owner’s intention to transfer the claim.
Valuable consideration is essential to support the assignment, and while the word “consideration” doesn’t necessarily have to appear on the document, Eversman recommends it as evidence of the exchange required to make an Assignment of Proceeds valid. Essentially, this allows you to take possession of the vehicle without receiving payment if the document is signed, but you are also agreeing not to sue the consumer for money owed as part of the assignment.
In your supporting documents, you should also include an Assignment for Money Due which must identify the customer, the repair facility, the vehicle and the loss. As long as this is without defects, it should be enforceable without being notarized (dependent upon state laws).
The Writ of Replevin is a document that the insurance company typically uses to retrieve a total loss vehicle, filing it to say a shop is unlawfully withholding a vehicle when they do not want to pay for the repair. Because this document is only valid if the insurance company can prove the shop is wrongfully withholding the vehicle, it is imperative that you are prepared to defend yourself against a Writ of Replevin by including a clause in the Repair Contract that states the consumer cannot transfer the title of the vehicle without ensuring the repair bill is paid in full. With the vehicle owner’s signature affixed to this verbiage, the insurance company has no right to the vehicle until they have paid for the repair, making their Writ of Replevin effectively useless.
So, with the Authorization to Repair, Repair Contract, Assignment of Proceeds and defense against the Writ of Replevin, you are well on your way to protecting your business interests, but you’ll also need a Parts Notice and Authorization as well as an Indemnification Letter (we’ll cover these next month in the third and final installment of this series). You can still get started right away by contacting a local attorney to start drafting these important documents which will allow you to recover proper compensation on every repair that comes through your shop doors.
Although the Independent Automotive Damage Appraisers Association (IADA) was forced to move the location of their 46th Annual Vehicle Repair Conference to the Lord Baltimore Hotel, located at 20 West Street, Baltimore MD 21201 at the last moment, the conference was successfully held on June 18-20, 2014 as “an educational tool for our members and the industry,” John Williams, Executive Vice President of IABA explains. “For guest speakers, we have experts in various fields relating to current methods of repair as well as what to expect from manufacturers in the future. Our expectations for this event are to promote our association and members as professionals committed to exceeding industry expectations as well as providing our members an educational and social venue to network with clients.”
According to Williams, “attendees were very pleased with both the location and the agenda. Our event always focuses on education and training as well as being a social event for members and guests, and it is important because it provides members with an opportunity to train and remain a viable force in the industry. This year, our conference exceeded expectations. We try to build on what we learned in the past to make our next event even more dynamic.”
Registration for the conference began on Wednesday, June 18, at 1PM and continued until 6PM when IADA held their Welcome Reception followed by exhibitor showcases which concluded at 9PM. After breakfast on Thursday morning, IADA President Leo Maki’s Welcoming Address served as the opening to the event.
IADA planned an exciting agenda filled with informative seminars led by nine industry leaders. Around 8:30AM, the educational seminars began with Wayne R. Schaumburg’s “An Illustrated History of Baltimore,” followed by “Best Claims Practices” which was presented by Harvey Lightstone, Vice President of the Directory of Claims and Risk for Management Claims Professionals Liability Insurance Company. Before lunch, Jim Aulby, Vice President of Claims Protective for Sagamore Insurance, discussed “Heavy Equipment Estimating.”
The seminars resumed at 12:45PM with the Highway Loss Data Institute’s Senior Vice President Kim L. Hazelbaker’s “New Technology of Electronics in Vehicles.” Thursday’s lectures concluded at 4PM with “Investigating Fuel System Contamination” as presented by Jeff Lange, President of Lange Technical Services LTD. Attendees then enjoyed a two-hour break which gave them a chance to visit exhibitors before attending the President’s Reception and dinner banquet.
On Friday morning, Dan Oscarson, Vice President of Global Marketing Insurance Auto Auctions, explored “Marketing Salvage in a Global Economy.” He was followed by CIECA Executive Director Fred Iantorno’s “Getting It Done for the Industry.” The final presentation, “Aftermarket Truck Parts,” was led by Donald B. Cameron, President and Founder of Dawson Truck Parts. After their closing remarks, IADA’s conference culminated with their membership meeting.
“Our 46th conference went well, even after facing the challenge of relocating to the Lord Baltimore Hotel at the last moment due to unexpected issues with the hotel we had contracted with. Our conference has always focused on education and training; this year was no exception!” Williams recalls, “our conference started with an excellent presentation by a local historian speaking about the history of Baltimore, and attendees were amazed to learn how Baltimore’s history helped shape many industrial and cultural advances we enjoy to this day. Attendees were given a glimpse of future vehicle technology as well as a look at the past to learn how far vehicle technology has progress and what to expect in the future.”
In regards to the valuable information provided at the conference, Williams also notes that “a presentation on Global Salvage was of great interest to learn how salvage vehicles are being purchased in the US, then shipped in cargo containers with available parts to repair included with each vehicle. Vehicles that would not be put back on the road are repaired in many third world countries due to cheap labor and a shortage of vehicles. Vehicles we take for granted are a luxury in many countries since few have options such as air or other power options.”
IADA was first founded in 1947 as the Independent Appraisal Plan (IAP) with a mission “to offer an unbiased automotive specialist appraiser to assess vehicle damage and establish a fair cost of repair,” Williams recalls. That same year, IAP was approved by the Association of Casualty and Surety Companies and the National Association of Mutual Companies. In 1964, the IAP reorganized and was reborn as the IADA, a national not-for-profit trade association.
Currently, IADA has 98 members in 43 states who employ more than 600 appraisers in over 400 service locations. Over the past 15 years, membership in IADA has increased around 15%. Williams details their membership process: “in order to apply for membership, applicants are required to have five years’ experience in the industry and owned and operated an appraisal firm for the past two years. We conduct a background investigation on all applicants, followed by a site inspection requiring the applicant to prepare a professional damage appraisal. Our Board of Directors then vote on the applicant.”
Though obtaining membership to IADA seems somewhat involved, the cost-savings benefits offered to members makes it well worth the effort. For starters, E&O/GL insurance is provided under a blanket policy and is included in membership dues with no additional charge. Members receive discounts on estimating software from all three providers plus discounts on CarFax, NADA Online and Old Cars Price Guide reports. IADA members are also listed on the association’s website as well as in their annual service directory, around 7000 copies of which are distributed throughout the industry. In addition to the national marketing supplied, members have the opportunity to attend IADA’s national conference which provides them with useful educational seminars as well as the chance to network with other IADA members.
Still, IADA strives to continually add new member benefits in their efforts to attract new members. They also continue to promote educational and training seminars at regional and national events. The association works toward securing new business for their members by “upholding the integrity of the association and being consistent with our honesty policy to enhance our position with the public, insurance industry and automotive repair businesses,” Williams explains. “Our current goal is to recruit new members who have an interest in joining a professional organization dedicated to serving the industry with truly ‘Trained Professionals.’ Our members take pride in delivering professional, unbiased damage appraisals. Our goal is to treat the consumer the way we would expect to be treated if we had a claim.”
Regarding challenges currently facing the industry, Williams notes, “DRP programs have impacted our volume of business to a great degree. While DRPs may be a good concept for smaller losses, I feel some carriers’ attempts to completely control the repair process, no matter how large or small the loss, is a mistake. Having owned and operated an appraisal firm for 24 years, I enjoyed a great working relationship with repair facilities. Preparing an accurate appraisal and securing an agreed price with a reputable shop is quickly becoming a lost art. The industry is losing qualified appraisers at a rapid pace. Many of our members had second, third and fourth generation family taking over their businesses, but we are no longer seeing as much of that.”
IADA Association
PO Box 12291
Columbus, GA 31917
www.iada.org
800-369-4232
On Saturday, July 26, Wheels to Prosper shops across the country gave away 15 vehicles to deserving people in their communities. Dino DiGiulio, owner of Body Best Collision Center in Sonoma, CA, and founder of Wheels to Prosper, notes that it is “mind-blowing to be able to change people’s lives in this type of way” and wonders “how big it could be if we got all the shops in the country involved?”
This year, Body Best awarded their car giveaway vehicle, a 2004 Saturn L300, to Irene Morgan. DiGiulio’s son, Chance, helped Body Best’s technician with the body repairs as his senior project, which his father proudly reports received a grade of “A”.
In 2010, DiGiulio took a public relations class at Management Success, and he admits “I didn’t realize how important it was until I took the class.” When the topic of car giveaways came up, DiGiulio thought it seemed like a practical way of giving back to the community. His friend, Jody Gatchell who owns A & J Collision Repair in Conway, AR was involved with a similar concept through Recycled Rides, and when DiGiulio saw an emotional video about a giveaway recipient, he knew he had to do it.
After acquiring information about the program from Gatchell, including how to organize a car giveaway, DiGiulio began planning Body Best’s first Car Giveaway with the initial intention of donating two to three vehicles yearly. Rather than choosing a person in need, DiGiulio put together a committee to choose a winner, enlisting the aid of a diverse panel of public officials and community leads to select a deserving individual. Early on, DiGiulio decided to choose winners who deserved a vehicle, rather than simply donating to someone in need, because “need is always there,” he explains. “We wanted to help people who help others. Everyone has to do their part, and this is my way of volunteering. By helping this person, he or she can help so many others.”
Gatchell suggested Wheels to Prosper as the name for DiGiulio’s giveaway, and Management Success advised DiGiulio to secure the name and website, helping him build the site. The idea behind Wheels to Prosper was to establish a program to help shops begin the process of sponsoring car giveaways, and when he pitched the idea for a national giveaway to 30 shops in hopes of getting more interest in the program, 11 shops signed up that same day. “We laid out some parameters and established a process, including marketing – there’s a lot of marketing you can do for free because people want to help,” DiGiulio states.
In the four years since its inception, Wheels to Prosper has increased to include 34 shops donating around 25 cars annually, but the program is growing consistently; DiGiulio hopes, by next year, 100 shops will participate in Wheels to Prosper’s annual giveaway because “Jody and I cannot do as much alone as we can when we involved the entire industry. Wheels to Prosper is all about telling shops how easy it really is.”
Though Wheels to Prosper is expanding to include non-Management Success shops, shops interested in participating in the program need to acquire approval from DiGiulio and the program’s administrator, Jim Anderson, because they want to elicit involvement from shops committed to giving away at least one car each year. Anderson, owner of Anderson Automotive in Marion, IA, did a giveaway called “Wheels of Change” several years before DiGiulio began his program, but Anderson joined Wheels to Prosper’s board as their administrator because he wanted to be part of something bigger.
Participating shops pay a one-time fee for inclusion on Wheels to Prosper’s website, but this provides a place to promote their business as it generates traffic back to the shop’s website; DiGiulio estimates receiving around 100 visits to his shop’s website annually through the link from Wheels to Prosper. He states, “it demonstrates that you actually care about the community. It’s a little about business but not really – it’s mainly about how many people are impacted by the donation.”
Wheels to Prosper does not hold any type of contest to determine their winners. Instead, they solicit stories from community members about a person who deserves to win the car giveaway, and a panel of judges reviews the stories to select a winner. “The difference between Wheels to Prosper and other giveaways is that it’s about who is deserving,” DiGiulio explains. “There’s always a need, but we want to help someone who is helping the community, so our winners are always majorly involved with volunteering efforts.”
In May 2011, DiGiulio held his first giveaway, awarding a car to a five-person family run by a local woman who is very active in her community. “She always thinks of everyone before herself. Even though she didn’t have the means to buy a car, she was still actively volunteering in the community, so we rewarded her efforts by giving her a car which allows her to help others even more.”
Gatchell held his giveaway in July 2011, and DiGiulio held a second giveaway that same year. Afterwards, they decided to choose a consistent date for the annual giveaway, electing the last Saturday in July at 12PM CST. Ultimately, the goal is for all Wheels to Prosper shops to hold their annual giveaway on the same day each year.
While the participating shops acquire the giveaway vehicles through various means, Wheels to Prosper requires the donated vehicle to be in good shape with less than 100,000 miles on it in hopes of servicing the winner for at least five years without any troubles. DiGiulio’s first giveaway was a salvage loaner with low mileage, and for his second giveaway, he purchased a vandalized car that just needed a new paint job. No matter how the vehicles are acquired, the Wheels to Prosper shop makes any collision and mechanical repairs necessary before donating the vehicle to their deserving new owner.
Thus far, nearly 50 cars have been given away through Wheels to Prosper with a few more giveaways scheduled to take place in October. A film company is currently in negotiations to develop a 12-part miniseries on a shop sponsoring a giveaway, and DiGiulio is optimistic about the publicity that such a program would provide for Wheels to Prosper.
www.wheelstoprosper.org
The Wisconsin Auto Collision Technicians Association (WACTAL) held the 2014 WACTAL Conference and Trade Show Friday–Saturday, February 21–22, 2014, at the Wilderness Resort in Wisconsin Dells, WI.
The conference began on Friday morning with a slew of educational seminars. Greg Horn, VP of industry relations for Mitchell International, educated attendees on the current state of the collision repair industry by exploring claim frequency trends and key performance indicators (KPIs). He also touched on advancing vehicular technology in terms of changes in vehicle construction and the increase in cars being manufactured with accident avoidance systems.
Mark Mueller of PPG Refinish followed with "The New Collision Repair Administrative Paradigm." This seminar sought to teach participants a better way to deal with the pressures related to an increase in administrative responsibilities for managing claims.
After lunch, Tony Passwater, president of AEII, presented "How Have We Gotten Where We Are Now?" during which he examined the strategies used to force the collision repair industry into its current state, as well as how to identify and counteract these practices to improve the industry’s future.
WACTAL members met for a brief meeting before opening the trade show on Friday night. This was followed by the Hospitality Social, which provided attendees and exhibitors a chance to relax and network while enjoying the hors d’oeuvres sponsored by BASF, Body Shop Supply Co., Broadway Automotive Group, Finishmaster, Motors Service & Supply, PPG, and West Bend Mutual Insurance.
In "Salvage Vehicle Inspection – What You Need to Know" on Saturday morning, trooper Quinn Sieber, salvage vehicle inspector for the Wisconsin State Patrol, reinforced the illegality of removing VIN tags.
With the conclusion of the informational seminars, the trade show reopened on Saturday, an exciting expansion from previous years when the show was only open one day.
Nearly 30 companies exhibited at the 2014 WACTAL show, including 3M, Akzo Nobel, Axalta Coating Systems, Mitchell, BASF, PPG Industries, FinishMaster, and many others.
All aspects of the event were well-received by participants, though stormy weather on Thursday and Friday impacted attendance slightly.
The Automotive Recyclers Association (ARA) held their 70th Annual Convention on November 6 through 9 at the Sheraton Convention Center in Phoenix, AZ. Michael Wilson, CEO of ARA, was pleased with the event, and, though they are still finalizing the balance sheet for this year, he believes “the 2013 Convention will go down as the most financially successful Convention in our association’s 70 year history.”