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Northeastern News

1HomePageMap small ne 0816Local news stories affecting the auto body industry in New York, New Jersey, Pennsylvania, Delaware, Connecticut, Maryland, Rhode Island, Massachusetts, New Hampshire, Vermont and Maine

Following flooding and damage done by Hurricane Irene and Tropical Storm Lee, body shops and dealerships on the east coast were not prepared to have to deal with heavy rain storms. In northeast Pennsylvania and western New York state heavy rain drenched an already inundated area with more water the week of September 26.

During Hurricane Irene, rushing water ripped the bay doors off the service department at Maroon Kia in Wayne, NJ. The water was so powerful it washed two front-end alignment machines, each weighing an estimated 2,800 pounds, from the service bays into the nearby Pompton River. About 40 to 50 new and used vehicles were destroyed by the floodwaters, according to a report in Automotive News.

The dealership’s building that houses the new-car showroom and service department had severe cracks in the walls and ceilings following Irene. The dealership’s used-car lot was littered with holes—one about 15 feet long, 10 feet wide and 6 feet deep.

The National Automobile Dealers Association says it estimates that 10 percent of the dealerships in states affected by the recent storms would be unable to operate due to storm-related damage, according to Automotive News.

Maroon Kia sustained major damage and waterlogged vehicles. Other dealerships said the only impact came from distracted customers who prepared for the storm rather than shopping for vehicles.

Following Hurricane Irene, Station Auto Body in Newark, DE, was left under 3-1/2 feet of water, according to owner Rob Amadio. Luckily, the shop was able to get out from under the flood waters and returned to normal service shortly after the hurricane passed through. Amadio said they did not experience any recurring flooding in the storms at the end of September.

McBride Auto Body in Woodland Park, NJ, also sustained flood damage due to Hurricane Irene, and owner Joseph Carioti III took advantage of the mandatory cleanup as an opportunity to renovate some parts of his shop. Most of the flooding damage occured in the office area of the building, since the shop floor is bare concrete, but parts of the business were under 4-feet of water after Hurricane Irene blew through.

Thankfully not all of the cars were flooded during the storm, but the business did lose some tools that got damaged by all the floodwater. McBride’s office area is now better than before Hurricane Irene hit, he told Autobody News.

The North American arm of Nissan Motors announced September 29 that the all-electric Nissan Leaf is expanding its availability in the U.S.

Starting September 29, the company will be taking orders for the 2012 model year Leaf from consumers in Colorado, Massachusetts, New Hampshire, New Jersey and New York.

“A prioritized ordering phase” will be in place for customers in these states who have previously placed a reservation for the Nissan Leaf, says the company.

On September 26, the company says it will open to the general public a new reservation process for the all-electric car.

And by the end of this year, Nissan hopes to take actual consumer orders for the 2012 Nissan Leaf in seven more states including—Delaware, Indiana, Louisiana, Nevada, Ohio, Pennsylvania, and Rhode Island.

Delaware Insurance Commissioner Karen Weldin Stewart has fined Allstate Insurance Co. and its subsidiary Encompass Insurance Co. a total of $50,000 for violations of Delaware insurance law.

The fines are contained in two separate consent orders, signed by Stewart this month.

The Allstate consent order asserts that the company violated insurance law by failing to provide defensive driving discounts to qualifying policyholders.

The Encompass consent order asserts the company violated the law by imposing an accident surcharge on policyholders involved in accidents even though they were not the party at fault. In all, 3,645 Delaware policyholders were impacted.

Allstate and Encompass cited computer errors and programming oversight as the cause of the violations and have said the problems have been fixed. Stewart wrote the orders in a way that would allow her to increase the fines up to $100,000 on each company if the problems re-emerge.

Stewart said she believes both companies did a good job of notifying and refunding all monies owed to policyholders, which totaled $848,355.

However, Stewart said she remains concerned about the effect these types of mistakes have on highway safety efforts, especially her department’s defensive driving program.

“One of my goals is to improve our state’s highway safety by getting more Delaware drivers into our defensive driving courses. What is more, I am committed to making sure that drivers who complete an approved defensive driving course get the discount to which they are lawfully entitled,” Stewart said.

Four New York collision repair facilities have received recognition from the Coordinating Committee For Automotive Repair (CCAR) in its GreenLink Shop program, the organization announced.

The newly-recognized shops are:
Carubba Collision, Buffalo, N.Y.
Carubba Collision, Hamburg, N.Y.
Carubba Collision, Tonawanda, N.Y.
Carubba Collision, Wheatfield, N.Y.

“We are proud to recognize the newest recipients of the GreenLink Shop designation, bringing our total to 143 shops since the program’s introduction in January 2010,” said Daren Fristoe, CCAR president and chief operating officer. “We are seeing more and more auto repair facilities incorporate environmental and safety stewardship in their business and marketing plans, and we look forward to greater levels of awareness in the coming months.”

All four shops being recognized are participants in the GEICO Auto Repair Xpress (ARX) program. CCAR and GEICO are partnering to promote the GreenLink Shop designation for GEICO’s ARX facilities across the United States.

The GreenLink Shop status, which serves to promote consumer confidence in local automotive repair facilities’ environmental/safety awareness and stewardship, is an extension of CCAR’s CCAR-GreenLink Environmental Compliance Assistance Center and S/P2 Safety and Pollution Prevention E-learning Program.

Repair facilities pursuing GreenLink Shop status must maintain high standards in environmental, health and safety (EHS) practices in four categorie. The CCAR initiative recognizes auto service facilities and collision repair shops, with separate criteria for each type of business.

Thursday, 22 September 2011 15:44

Ex-Insurance Agent in PA Sentenced for Fraud

Insurance Journal reported that a former northeastern Pennsylvania insurance executive has been sentenced to 5 1/2 to 16 1/2 years in state prison in what prosecutors said was a pyramid scheme worth at least $7 million. Brian Murray, 68, former head of Murray Insurance Agency Inc., was arrested in July, 2010 by agents from the state attorney general’s insurance fraud section. He pleaded no contest in June to felony counts of criminal conspiracy, theft by deception and theft by failure to make required disposition of funds. Murray was sentenced in Lackawanna County Court.

Prosecutors said he and others took premiums from new clients to conceal the thefts from others and never procured the insurance the customers thought they were paying for. Moses Taylor Hospital, Mount Airy Casino Resort and the University of Scranton were among the alleged victims of Murphy’s fraud.

Some of the fraud was uncovered after Pennsylvania Manufacturers Insurance and Travelers Insurance conducted audits of Murray’s accounts.

Allstate Corp. lost $500 million on Hurricane Irene, the largest publicly traded home and auto insurer in the United States said September 15, much less than it lost from tornadoes earlier this year.

In total, Allstate said its July and August disaster losses came to $865 million before tax. The company did not break out the source of the other losses besides Irene.

In April and May, Allstate lost $2 billion because of severe thunderstorms and tornadoes. That nearly equaled its disaster losses for all of 2010.

Industry estimates on the damage caused by Irene have varied widely, in part because most of Irene’s damage was from federally insured flooding and not privately insured wind effects.

Some estimates suggest the total privately insured loss from the storm was less than $2 billion.

Allstate began releasing select monthly disaster data earlier this year after pressure from analysts, who wanted more clarity on the company’s catastrophe exposure.