15 Years Ago in the Collision Repair Industry (July 2003)
Third-party “desk auditors” faced some critics and tough questions during a panel discussion at the Collision Industry Conference (CIC) held in Hollywood, FL, in late July.
Representatives of three companies that offer insurers remote reviews of repair estimates discussed their companies’ histories, employee training and auditing practices. The three were asked, for example, whether they are compensated for their work based upon the amount by which they are able to reduce a shop’s estimate.
“We are compensated on a per-file basis, whether there are savings or not,” said John Gizzio of American Computer Estimating (ACE), a Pennsylvania-based desk review company that audits more than 10,000 claims each month. “We do not take part of the savings. And we do ... charge if there are no savings. We are compensated for every job that we do.”
Mike Price of the Georgia-based, 30-employee Audit Services, Inc., also said his firm is paid on a per-claim, per-assignment basis. Mike Saliba, vice president of ComSearch’s Ready Review desk auditing service, said his company’s compensation is “based on a number of things, but savings is not one of them.”
Gizzio said that some of the savings they offer insurers is not just in reduction in the bottom line of repair estimates, but in reductions in cycle time, rental costs and direct expenses such as field adjusters.
All three of the companies say they are not using electronic systems that automatically flag certain items on estimates for review. Rather, the reviewer enters the estimate into the company’s chosen estimating system and checks it against the profile established by their insurer client. While those “profiles” cover such things as non-OEM and salvage parts use, all three of the companies say they do not change “judgment” repair times.
“We do not adjust or change judgment items,” Price said. “We apply our client’s guidelines... When it comes to a judgment item, obviously we haven’t seen the damage.”