Sunday, 30 September 2007 17:00

Nevada Legislative Update

This has been quite the Legislative Session for the Nevada Collision Industry Association (NCIA) with both success stories and defeats. This is our second Legislative Session as an Association and we have learned that we have a lot more to learn.

AB181 Labor Rate Survey

The annual Labor Rate Survey has been taken by the Department of Insurance (DOI) for as long as any of us can remember. We’re not sure what the original intent of the survey was but we know that it is used by many insurance companies as a gauge for what they are willing to pay for repairs.

Each year, the survey seemed to be mailed out later and the results coming back have had no sense of urgency. The system simply was not working for the benefit of our industry.

AB181 puts the survey in an online format similar to the State Farm survey. This will make the process quick and simple to compile the numbers without months of lag time. The Bill was passed out of the legislature and has been approved by the Governor.

AB185 Insurer Owned Body Shops

This Bill would have made it illegal for insurance companies to own body shops in Nevada. The idea was taken from the HB 1131 passed by the Texas legislature and upheld by the courts. (See www.autobodynews.com) The Texas Legislature decided that it was an inherent conflict of interest for an insurance company to own a body shop and so passed legislation to forbid the practice.

With the help of one of the Board Members of Automotive Service Association (ASA) Jerry Burns, we made our modest case for approval to the Assembly Committee on Transportation. We quickly realized that we were outgunned.

The insurance lobby brought their expert witnesses up to discredit the bill and our industry. They portrayed the collision repair industry as common criminals who routinely defraud the consumer and the insurance industry alike. They claimed that up to one-third of all charges are fraudulent and because of this they were forced to create their own shop to protect the consumers, who are their customers.


Then the Sterling CEO came to the stand to explain what he felt the real purpose of the bill was. He started with a 5-minute video detailing the superior features of Sterling Collision Centers. He then suggested that the whole purpose of the bill was simply to get rid of the competition. He claimed that because the collision industry was unable to match the quality and superiority of his shops, they were going to attempt to legislate Sterling out of business, thus eliminating the competition.

By the time all the insurance representatives were finished, the collision repair industry had no legs to stand on. The bill was finished. The chairman indicated that could go to a Committee vote which he indicated would be in the negative, or it could die a nice quiet death in his desk drawer. The latter was choosen.

AB492 Claimants Bill of Rights

This bill was a bit more complicated then the name suggests. It had the following features:

        1. Prohibited insurance companies from charging betterment. Examples: prorating tires and batteries destroyed in accidents.

        2. Claimants would not have to pay for car rentals nor be denied a reasonable amount of time while vehicle is in the shop.

        3. Prohibits desk reviews from non-DRP companies. Claims could not be negotiated by photos only but must have on-site inspections unless written agreement exists.

        4. Insurance carriers have two working days to respond to estimates and supplements or the shop may proceed with work.

This bill never received a hearing. After being introduced on the Floor of the State Assembly, to our surprise it was referred to the Committee of Labor and Commerce. The Chairman of that Committee never allowed the bill to be heard and thus it died.

AB594 Class-A Endorsement

The parameters for this bill came from the Collision Industry Congress (CIC). It sets criteria for establishing topnotch collision repair facilities. It doesn’t change the current licensing requirements set in statute, it only creates an optional endorsement that can be added to the license to set it apart in terms of equipment and training. Several states have already incorporated similar statutes and a few others have proposals in place to do the same.

The bill survived numerous obstacles and had some very close calls but in the end it survived and was passed out of the Legislature. It was signed by the governor within ten days.


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