Tuesday, 30 April 2002 17:00

Texas group calls for political donations to fight Allstate-Sterling

Allstate Insurance Company has announced that it plans to build six new Sterling/Allstate locations in the Dallas/Fort Worth area. All locations will be new construction and be approximately 16,500 sq. ft. of office and shop area. Allstate currently has 39 other locations around the country and eight located in the Houston area. 

AASP-Texas is very concerned about Allstate owning their own body shops. It is the position of the Association that Allstate's operation of collision repair facilities in the State of Texas is a violation of Article 5.07-1 of the Insurance Code. The article states that an insurance company or their agent cannot accept a gratuity ( a gift of money, over and above payment due for services) for referring a beneficiary or third-party claimant to collision repair facility to repair the damage.

If Allstate is going to refer their clients to one of their shops and make a profit on the repair of the vehicle referred, then they are receiving a gratuity or kickback for the referral. This would be a violation of the act. Allstate's wholly owned subsidiary, Sterling Collision, has the ability to repair vehicles at or below cost due to their financial relationship with Allstate. It will not require a profit for the shops to remain in business. This will be an unfair business practice when Allstate then dictates to other shops in the market the price and procedures they will pay based on their company owned shops.

The repairs may not be in the best interest of the consumer. If Allstate is allowed to do this in Texas and other states, who will be the next insurance company the follow. As an Association, we need to fight this. We need to start building our PAC fund with contributions and lobby in this next session of the legislature for legislation to stop this practice. This is a threat to the entire collision industry. Now is the time to rally behind your association to fight this. Please send your contributions to the AASP-PAC fund. The checks need to be a personal check made payable to AASP-PAC and can not be a corporate check. If you have any questions, please do not hesi- tate to call the Association office at 800-606-2728.

Automotive Service Providers of Texas is a non-profit organization of mechanical and collision repair shops. Offices are in Austin. E-mail: asptx@prodigy.net Fax: (512) 708-1721.


* Automotive Service Providers of Texas


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