Thursday, 23 February 2012 09:13

Getting a Guess-timate From the Real Experts

Written by Insurance Insider

Before 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.

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.

Estimating is best defined by the actual root of the word: estimate. No matter what any expert tells me, estimating isn’t an exact science. In fact, if it was an exact science it would be called a repair bill, not an “estimate.” 

Look at the cartoon with this article and tell me which one of the estimators is right. If you said, “All of them,” or “None of them,” you would be today’s lucky winner of a Popeil Pasta Maker. (Note to self: Add Pasta Maker to this year’s Christmas wish list.)

I hope this doesn’t insult anyone who makes their living writing estimates. My intent is to illustrate that any one of them could be right. The monkey was willing to do it for three bananas; does that make him wrong?

To nobody’s surprise and to the delight of stockholders everywhere, the insurance company wrote the lowest estimate. If I were put on the stand, I could defend this estimate. It is a visual damage estimate without any tear-down. Does it make the insurance company wrong if there is additional damage behind some of those parts? That’s why it’s called an “estimate,” complete with a disclaimer at the bottom.

I know that this article will result in some hate mail, but the fact is that it’s not an exact science and it’s wrong to say “the damage is the damage.” If that was the case, why does it cost more to have vehicles fixed at one shop compared to another one that’s a block away with the same labor rate? It is subject to opinion, experience, tear-down and a hundred other factors including whether or not it was raining out or 20 degrees below zero at the time of the estimate.

By the way, those “other factors” apply to both repairers and insurers. I’m sure estimate accuracy at 4:45 p.m. on a Friday compared to 11 a.m. on Tuesday is worthy of another article on Insurance Company Estimating 101.

Here’s a good recipe to produce an accurate, consistent estimate. It should include a visual inspection, a lift, tear-down, a thorough washing of the exterior of the vehicle, ample time, 3-dimensional measuring equipment, a preliminary pull if needed, updated estimating software, a live competitive parts database, an experienced flexible estimator, use of best-case repair scenarios, 75 degree sunny weather with no clouds, and of course 20/20 vision.

If you were to have all of those things, you are guaranteed to get an estimate that gets you closer than the guess-estimate. So please stop using the term, “The damage is the damage.” If that was the case, don’t you think that Ron Popeil would have already simplified our estimating lives?