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 California Insurance Commissioner Steve Poizner praised Superior Court Judge Loren McMaster’s recent decision to uphold the Department of Insurance’s victory on auto rating factors. The judgment concerns the weight to be given to automobile rating factors in an insurer’s rating plan, amendments which went into effect last August.
 California Insurance Commissioner Steve Poizner recently announced the arrest of two suspects in connection with staging automobile accidents in California and filing insurance claims for medical treatment they falsely claimed to have received in other countries.
 The Collision Repair Association of California’s first Legislative Day 2007 at the state capitol in Sacramento opened the eyes of legislators and staff to illegal insurer steering practices.

California Governor Gray Davis has signed into law SB 1146, a bill mandating that the independent aftermarket will have access to service information and tools necessary to repair and maintain vehicles equipped with on-board diagnostic computers (OBD systems). 

The Quality Parts Coalition (QPC) has joined with CAWA in the growing consortium of independent parts and industry organizations, insurance companies and consumer groups working to preserve competition in the automotive collision replacement parts industry.

As part of its strategic plan to create an online community for commerce, Ensera, Inc., www.ensera.com, eported today that it has finalized a progressive partnership agreement with BASF's Automotive Refinish Group.

Ensera, the Redwood Shores, California-based company is a leading provider of solutions that automate the marketplace process for the automotive collision repair industry.

If you think the collision repair industry is changing rapidly, spend a little time talking with the owner of your nearby auto salvage yard: 

Seemingly conceding that its previous position on estimating system data was untenable, ADP announced in April it was putting on hold its plan to encrypt that data and make it unusable by unlicensed third parties such as Internet claims management companies. 

California State Senator Jackie Speier (D - San Francisco/San Mateo) predicted that "there will be a battle in the legislature over quality crash parts" within the next year and that she may be "promulgating rules on anti-steering," an issue on which she expects State Insurance Commissioner Harry W. Low to take an aggressive attitude. 

It is time for our community to call upon the true authority of the 1963 Consent Decree and utilize it as a tool to bring about a substantial change in the method in which consumer claims are handled in our collision repair environment. 

When Allstate Corporation last month acquired Sterling Collision Centers Inc., a consolidator with 39 collision repair shops in seven states and nine metropolitan areas, it started a shockwave that resonated across the industry with as much thunder as the State Farm non-OEM parts verdict. 

"If you're a good shop, you have nothing to worry about. If you're a bad shop, you have every reason to be concerned!" warned the California Bureau of Automotive Repair's Robert Trent. Trent, who works out of BAR's Oceanside office, was addressing the San Diego chapter of California Autobody Association at their July meeting. Trent and his associate Bill Neu discussed the BAR inspection program that began July 1. The inspection program was created by the Auto Insurance Fraud Act (SB 1998) of 2000. 

Friday, 14 September 2007 10:00

State Farm inks parts deal with OEMs

State Farm is jumping into the parts purchasing business.
    The insurer has negotiated a deal with some of the original equipment manufacturers (OEMs), including GM, Ford, Chrysler, Toyota, Honda, and Nissan, to reduce the manufacturer’s suggested retail price (MSRP) on parts by three percent.
Friday, 05 September 2008 03:30

SEMA Applauds Breakthrough Chinese Laws

SEMA Manufacturers Now Able to Sell 500 SEMA Product Categories to Growing Chinese Market

New laws in China enable SEMA member companies to sell products legally, according to the Chinese Ministry of Commerce. This historic announcement was presented during a recent meeting at SEMA headquarters in Diamond Bar, California, and was received with appreciation and enthusiasm by the association's leadership.

The major paint companies, struggling to overcome federal charges of price-fixing and their largely unsuccessful and expensive "shop investment" programs of the '90's are now focusing on "value added" shop management programs to attract and retain customers. 

Throughout the Las Vegas Convention Center the 35,000 attendees at last month's NACE seemed to be talking as much about the event itself as they did about the usual industry announcements, speakers and the "good deals" to be had on the trade show floor. 

On the heels of a federal antitrust investigation into price-fixing by paint manufacturers in the automotive refinish industry, at least four lawsuits have been filed around the country by paint distributors and body shops accusing the world's five largest paint makers of price-fixing. 

Auto body shops in California continue to get a black eye as the Bureau of Automotive Repair's (BAR) reinspection program picks up steam. A preliminary report issued in late January showed that 43% of cars inspected so far had evidence of fraud, with an average of $586 in overcharges for parts not used or labor not performed. BAR says that it has already inspected 507 vehicles and found evidence of fraud in 217, most often billing for parts not used or labor not supplied. 

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 California Autobody Association past presidents gathered at the annual meeting to honor the association's milestone year.  From left to right John Loftus, Kelly McCarty, Don Feeley,Jr., Maureen Holmes, Jack Caldwell, Rick Johnson, Chuck Bistagne, Ed Van Klavern, Russ Scamara, Ron Guilliams (seated),  Rick Reiss, Bill Rupp, Joe Boivin and Warwick Bryan.

Farmers Insurance is pushing to elect California State Assemblyman Tom Calderon (D-Montebello) as the new Insurance Commissioner of California, and to aid in that effort it is apparently soliciting campaign contributions from companies it does business with including its Circle of Dependability (COD) DRP shops. 

He laughs when he's asked about Progressive's "Concierge" program. His shop has participated in this DRP program's trial run since last fall. "It makes me think of a twist on that old Oldsmobile ad slogan: 'This is not your father's DRP'," said the second-generation East Coast shop owner who spoke about the Progressive program on the condition that neither his real name nor his business location (not even the state) be revealed. 

Listed below is the proposed act with the reasons for our opposition in italics. These are OKABA’s reasons for opposing. OKABA offers this report, so it is clear, OKABA’s decision is definitive.

The bill declares that Oklahoma vehicle owners should have the right to:

 The Right to Repair Act introduced in Oklahoma has stirred up support from CARE and opposition from OKABA towards the pending legislation.
 Democrat Lucky Lamons introduced House Bill 1584 in Oklahoma legislature on February 6. The legislation seeks to allow motorists to choose where, how and by whom to have their vehicles repaired.
 Sandy Bass-Cors, a representative of The Coalition for Auto Repair Equality, CARE, is in support of this bill. She said that independent collision repair facilities would benefit from this legislation.

With the November 2006 elections, the people have spoken and their voices are resonating throughout the corridors of Capitol Hill. The balance of power in Washington shifted from Republicans to Democrats for the first time since 1994. This dramatic change presents new opportunities and challenges for the collision industry.
Monday, 05 March 2007 08:47

WIN conference to unite industry females

A dynamic docket of topics and speakers are in store for those individuals attending the Women’s Industry Network (WIN) conference scheduled for April 29 through May 1 in Phoenix, Arizona.

The conference will cut across functional job lines and bring together female shop owners, technicians, and service and product providers for a series of inspiring speakers and informative seminars.

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. 

The push for VIN Disclosure legislation in 2007 took a major step forward with Senator Trent Lott’s (R-MS) introduction of the “Consumer Access to Total Loss Vehicle Data Act” (S.545).

The ARA said Senator Lott’s bill exemplifies his commitment to stem total loss vehicle-related fraud, theft and other illegal total loss vehicle activities, not only in the U.S., but worldwide. ARA applauds Senator Lott for his leadership in the effort to stem the abusive practices associated with title fraud.

The preliminary data from the California Bureau of Automotive Repair (BAR) auto body reinspection program that has found evidence of fraud in 43% of vehicles inspected is unlikely to change significantly when the final report is issued early next year, according to Dan Povey, the Sacramento-based program manager. "We have a solid six months of data in the computer. Based on my experience, the data from the first six months is usually indicative of what the final numbers will look like." 

Used or "recyclable" parts were the focus of discussion during a number of other presentations at the Collision Industry Conference (CIC) held in mid-March in Nashville, Tennessee. 

Tuesday, 30 April 2002 10:00

GM says tests prove CAPA parts fall short

GM says its recent evaluation of fenders and hoods with CAPA stickers proved that they don't meet GM specs for fit, finish, material content and assembly characteristics. The GM hood was up to 40% stronger and 80% harder than the CAPA hoods. 

Three national collision industry associations are working together to enhance the accuracy and functionality of the estimating systems used by the collision repair community to fix today’s high-tech vehicles. The Alliance of Automotive Service Professionals (AASP), the Automotive Service Association (ASA) and the Society of Collision Repair Specialists (SCRS) have teamed up to examine and enhance the content of the data found in the industry’s leading estimating systems.

The project is titled the Database Enhancement Gateway (DEG) and goals include the development of an industry Web site that would allow collision repair professionals to file requests for reviews of the various estimating systems and view the responses from the information provider(s) once available.

A message to CCRE members

To all CCRE member shops, the following is an example of what CCRE is actively doing constantly on your behalf. The following response from CCRE was recently entered into the debate at the Ohio DOI, concerning pressure from insurers and imitation parts certifiers such as CAPA, to change the wording of existing Ohio Rules to eventually have imitation parts be considered the same as OEM.

CCRE actively opposed such changes when they were twice considered, on a national level, at NCOIL meetings. Now, it appears that insurers and their imitation parts certifiers are going to go to individual state legislators to try to accomplish this on a state-by-state basis. Ohio appears to be among the first states to be hit. Your state may be next. So, watch what’s happening in your state, and keep CCRE informed. Together we can keep this “mad dog” at bay. 

    When the Collision Industry Conference (CIC) participants voted in opposition of holding a press conference about the CIC Anti-Fraud Committee’s findings on insurers lowballing initial estimates, a flurry of emails kept the issue alive.
   Many concerned with the committee’s findings - which revealed that insurers initial estimates account for about one half of what the final invoice is - planned two summits, one in Phoenix and one in Chicago in January. The summits were not a CIC function. Ohio attorney Erica Eversman was the common denominator as she served on panels at both the summits.
Monday, 05 March 2007 07:29

Write the first estimate and win

    I have a friend who made so much money in the body shop business that he had to retire because he was paying too much in taxes.
    It was obvious my friend, whose nickname is Fast Eddie, knew how to make a profit. He made a profit in large part because he knew how to write an estimate. His goal was always to write a complete estimate from the beginning. He wrote every estimate himself, taking whatever time he needed—sometimes hours—to tear down the car. He ordered every part, including nuts and bolts, needed to fix the car. Once the estimate was written, he pulled the car out of his shop and stored it in a lot across the street.

Caliber Collision Center's Costa Mesa, California location was closed for a week by the California Bureau of Auto Repair (BAR) as part of a settlement agreement reached by Caliber and BAR following the BAR's allegations of fraud, gross negligence, faulty record-keeping, and failure to comply with the regulations of the Automotive Repair Act.

    CAA members are reminded that they must post, at their place of business a summary of job-related injuries and illnesses that occurred during 2006. The California Department of Industrial Relations (DIR) requires the summary be displayed from Feb.1 to Apr. 30 for employee review.
    This posting requirement is a vital part of every employer’s obligation to keep workers informed about conditions that affect their occupational health and safety,” said John Rea, acting director for DIR. It creates awareness among employees so they can understand how to avoid similar injuries in the future.

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Jay Leno’s futuristic Eco-Jet will be on display at the March 28 panel hosted by BASF. Invited guests will have the opportunity to get a closer look at this rarity, which was painted with BASF waterborne product. Statistics show that California currently produces 20.7 tons of VOC emissions per day. The new state regulations have an overall goal of reducing these to 5.1 tons per day. BASF reported that their products will aim to help California achieve these goals by offering eco-friendly profitability to collision repairers.

    California B.A.R. Chief Sherry Mehl told an industry meeting on February 23 that the B.A.R. was withdrawing disciplinary guidelines that it had filed last year pending further review of those guidelines with the CAA and other automotive industry groups. According to CAA Executive Director David McClune, “Mehl wants to work on a set of guidelines that the stakeholders and B.A.R. can agree with.”
Sunday, 30 June 2002 10:00

Why is a body shop like a fruit stand?

Larry Edwards says collision repair shop owners could think of themselves as produce managers in a grocery store. 

Active Image   Don Feeley, Russ Bogh and Kelly McCarty exchange a few words at the CAA annual meeting. Former assemblyman Bogh shared insights into his time in Sacramento during a speech he gave at the meeting. “You are a special interest in Sacramento,” Bogh told the delegates, “ and you need to make friends.  It’s hard (for legislators) to say ‘no’ to friends.”

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    California Senator Jenny Oropeza has re-introduced the bill that prohibits the sale or transfer of a total loss salvage vehicle damaged from salt water. The bill is an effort to protect the California consumer, although auto body technicians would benefit due to inherent risks involved with working on these cars
    The danger, explained in the text of the bill, stated, “vehicles that have sat in saltwater mixed with sewage can result in health risks. Hurricane floodwaters contain numerous toxins, including, but not limited to, raw sewage, E. coli, petrochemicals, human and animal remains, arsenic, and lead.”

    The California B.A.R. has rescinded the Cease and Desist Order it issued to Progressive Insurance over operation of its San Diego Concierge facility, this according to Jack Molodanof, the longtime Sacramento lobbyist for the Cali-fornia Autobody Association (CAA). Molodanof made the announcement at the CAA annual convention in Anaheim on February 10.
    The B.A.R. had issued the Cease and Desist Order last year when it investigated complaints and initially determined that Progressive was performing work at its San Diego claims office that required a B.A.R. registration. Progressive still refused to register with the B.A.R., its lawyers arguing that the work done at the facility in estimating collision damage did not constitute automotive repairs. Progressive receives vehicles at the claims center, estimates damage and selects a body shop to make the repairs. Customers then pick up the completed vehicle at the Progressive claims center.
A California State Senate Bill that would make it illegal for an insurance company to have any financial interest in a body shop passed the Senate on May 29 by a vote of 28 to 7, with support from both Democrats and Republicans. The bill will now go to the State Assembly Insurance Committee for a vote.

Over 100 auto repair shops, including at least six body shops, have been sued as a group in Orange County for violations of the State's Business & Professions Code (which includes violations of B.A.R. regulations). The suit, Consumer Enforcement Watch Corp. v 7 Day Tire, Muffler & Auto, et al. was filed April 11 in Orange County Superior Court, Santa Ana. It alleges that the various defendant repair shops harmed consumers when they violated B.A.R. regulations including failure to renew their registrations on time, writing improper estimates, failing to secure proper approval for estimates, and failing to return parts removed from vehicles.

The California State Assembly Insurance Committee has passed by a bipartisan vote of 12-4 the Senate Bill that would make it illegal for an insurance company to have a financial interest in a body shop. Having earlier passed the full Senate (29-16), the bill will be read and likely voted upon by the full Assembly between August 6 and the end of the month. If passed by the Assembly, it will go to the Governor's desk and could become law on January 1. 

The California State Assembly on August 29 turned down State Senate 1648, a bill that would have prohibited insurance companies from owning bodyshops and forced the Automobile Club to divest its interest in Caliber Collision Centers. This opens the door for more insurance companies to buy or take a financial position in collision repair facilities. Allstate has already announced that it intends to open 17 - 20 Sterling shops in California beginning next year. 

Five major paint manufacturers and seven paint jobbers are named in a class action lawsuit for price-fixing in violation of State antitrust laws filed on August 15 in Los Angeles Superior Court. The action alleges that the paint companies and jobbers engaged in "horizontal price fixing and minimum resale price maintenance." The lawsuit covers the period from 1993 to the present and asks for class action status on behalf of 7,000 California body shops. It alleges that defendants "conspired to fix, raise, maintain or stabilize prices for automotive refinishing paint." The defendants include paint manufacturers PPG, DuPont, Sherwin-Williams and Akzo Nobel, together with jobbers D'ANgelo & Sons, Tri-City Paint Corporation, Finishmaster, Inc., Auto Color Specialists, Inc., National Oak Distributors, Inc., and Hayward Color, Inc. 

The California salvage industry won what the collision repair industry couldn't; a partial victory in Sacramento with the passage of two bills - and the defeat of a third - that begin to level the playing field between licensed salvage yards and the gray market of automotive rebuilders that bids against them for wrecked vehicles. 

The International Autobody Congress & Exposition (NACE) Town Hall will provide a forum for discussion and debate about some of the collision repair industry's hottest topics, including state and federal legislation regarding insurer-owned shops and right to repair, diminished value (DV) and post repair inspections, fraudulent practices, steering and what it means to repairers and consumers, the future of the industry -- image, technician shortage and the aging workforce -- and repair information availability. 

Monday, 30 September 2002 10:00

Improving your position with OEM parts dealers

They can help you improve your shop's cycle time. They can offer ideas to make your shop's parts ordering more efficient. And they certainly can have an impact on your parts profit.

Ten body shops were closed down and 35 people arrested, 29 of them body shop employees, in a Santa Clara County insurance fraud sting operation. The operation used an undercover agent who approached body shops in the Bay area and asked them to write inflated estimates so that minor body damage, often intentionally inflicted by the vehicle owner, could be increased to cover total repaint jobs and upgrades like spoilers or new seats. The Santa Clara District Attorney's office has issued additional felony arrest warrants. The sting operation was the largest of its kind in the nation, according to the National Insurance Crime Bureau. 

California Gov. Gray Davis signed on Sept. 23 the nation's first family leave bill, providing benefits for up to six weeks a year payable from the state disability insurance program to workers who must care for sick family members - children, spouses, parents and, in the case of gay couples, domestic partners. The family leave can also be taken to "bond" with newborn children, newly adopted children and new foster children. 

Five body shop owners in Texas have filed suit against State Farm for damaging their businesses. The group, represented by Dallas attorney Christopher Davis, alleges that State Farm interfered with their businesses and acted unlawfully to restrain trade and commerce in the markets where the plaintiffs have (or had) their businesses. 

Saturday, 30 November 2002 09:00

PPG distributors store destroyed by fire

Monday, July 29, Dave Cooper was working at his home office, planning events to celebrate the fifth anniversary of his PPG Platinum Distributor location in St. Louis, Missouri, when he received a call informing him that his store, Cooper Color, was on fire. When he arrived at his store 25 minutes later, he said, "I knew it wasn't good." 

Holmes Body Shop, the largest independent chain of collision repair shops in Southern California, has settled confidentially the lawsuit brought against it by DuPont for breaching a contract to buy its paint from DuPont. 

"Working Small and Effective" was the title of a class at the International Autobody Congress and Exposition (NACE) in Dallas, Texas in early December, but it could have been an apt theme for the event. Many wondered whether NACE would "feel the impact" (the actual theme of the show) of the five major paint companies being absent from the trade show floor. Indeed, attendance by both shops and vendors was down. (For details, see "NACE by the numbers".) 

Tuesday, 31 December 2002 09:00

Texas senator pledges to fight tied shops

A Texas state senator promised at NACE in Dallas to introduce a bill in the Texas 2003 Legislature that would prohibit an insurance company from acquiring any financial interest in a collision repair facility and require that any insurer currently owning body shops divest their interest by Sept. 1, 2006. 

A Texas appellate court's decision last month to slash a monetary award in the a major mold-related insurance claim case should have a positive effect on the state's insurance market and help quell the national mold hysteria it engendered, according to the Alliance of American Insurers (AAI).