Can the insurance adjuster make me select an auto collision repair shop from a list of "approved" shops?
It is not legal for an insurance company to require that you take your business to any particular auto collision repair facility. Although they can "recommend" some auto body shops, the insurance adjusters CANNOT REQUIRE you to use a specific repair facility or to select from a list of their "preferred" shops. That is a practice called "steering", and if you take exception to it, you can report the adjuster to your state insurance commissioner.
You, the consumer, have the right to use any licensed repair facility that you choose. You cannot be forced to take your vehicle to any particular auto collision repair facility. You may choose your own place, but then there may be consequences that you may not like, as explained below. See California Department of Insurance.
"Preferred Shop", "Approved Shop" or the like explained On the other hand, there is nothing wrong with listing those shops that are pre-qualified by the insurance company to write its estimates, and, as you will see below, there could even be advantages to using such a shop. The advantages are notable particularly in: (1) getting your vehicle repairs started earlier without waiting for an insurance appraisal, and (2) in getting the insurance adjuster to go to bat for you in resolving any problems that might develop between you and the repair shop.
First of all, let's understand that the insurance company does not "own" the "Preferred Shop", "Approved Shop" or the like. Nor does the insurance adjuster have any right to dictate to the owner what will happen in any given job. The insurance company has just licensed the "Preferred Shop" to make estimates and to do repair work because through its past experience with the shop, the company believes that the shop is honest and that it will do work with satisfactory results. The shops selected by the insurer are usually part of the insurer's direct repair or referral program (aka "DRP"). The purposes of such programs are supposedly to benefit BOTH the insurance company and the consumer. See the discussion of advantages to using a "preferred shop" below.
Allegations disfavoring using a "preferred shop" There are allegations that these approved or direct-repair body shops get on the insurance company's list by keeping their costs low, and hence the company will be paying less to repair your vehicle when you use one of those shops. Some people-maybe some who are NOT approved shops-have stated that such preferred shops realize the alleged savings to the insurance companies through business practices that are not favorable to the customer.
The allegations mention such practices as spending less time on repairs, using cheaper parts, and overlooking damages that only an expert could spot. It is alleged that one prominent company even had a requirement that the auto collision repair shop personnel could NOT talk to their customers about their cars until they had cleared it with the insurance adjuster first.
And we are aware that these preferred shops are frequently accused by non-DRP shops of being required by the insurance company to use lower cost non-original parts or other cost-cutting procedures which may not truly restore the safety, appearance, and value of your car to pre-accident condition, and which may jeopardize your factory warranty.
Finally, it is alleged by some that because the insurance companies hold so much power in distributing auto collision repair business, many auto body repair shops can't stay in business unless they stay on those "Preferred Shop" or "Approved Shop" lists.
I need some help in figuring out where to take my wrecked car for repairs. The towing company took it to a storage yard that abuts one auto body shop, but that one just looks messy to me and I am afraid that their finished work would not be very high quality. There is a big auto accident body shop nearby that advertises on TV, and the insurance adjuster also gave me a couple of choices. Read the preceding answer to learn of the advantages and disadvantages of using one of those insurance company "Preferred Shop", "Approved Shop" or the like.
As for evaluating the "messy" auto repair shop and the "big shop that advertised on TV", try to gather information on as many of the following categories as you can. Taking a little time to do your research now-instead of just going along with using the shop where the towing company dropped off your vehicle-can pay BIG DIVIDENDS if your auto accident damage is at all significant.
Just the same, don't expect to spend a whole lot of time on this part of the auto accident recovery process UNLESS YOU HAVE AN EXPENSIVE VEHICLE OR YOUR DAMAGES ARE EXTENSIVE. If you have damages that do not involve a lot of money (say, $4,000 and less), or if your vehicle is not worth over $10,000, then it does not make a lot of sense to do the thorough version of this evaluation process. In those cases, make your evaluation on those topics below that you can assess without a lot of time and effort.
LEARN THEIR REPUTATION. Ask around; find someone with some previous experience or knowledge of that auto body shop. Ask the owner for three customer references. Complaints can be harder to come by, but maybe some dissatisfied customer posted something on the Internet, so Google their name. See if they belong to some local or national association. Give your local Better Business Bureau a call-or look it up online. They will list complaints.
GUARANTEES & WARRANTIES. Most successful, reliable auto collision repair facilities offer a WRITTEN warranty for their work. Do not accept a verbal guarantee. Get it in writing. The shop should offer a "Lifetime Warranty" on its Body work, and a minimum of "5 years" on refinishing.
TOUR THE SHOP TO SEE IF:
(1) Is their equipment sufficient to do the job? It seems that an impressive investment in equipment kind of equates to commitment to quality. No, we do not expect you to know one piece of equipment from another, but the auto accident collision repair facility you choose should do most, if not all of the auto body repairs in house.
It is common to send out the mechanical work to specialists, but when you have an expensive car, keeping as much as possible "in house". That way, you also keep the accountability "in house" with the owner of the auto body shop, instead of allowing him to "pass the buck" down the line. When the owner of the shop is mostly accountable, then that often helps ensure a better finished product. The equipment required to properly repair today's vehicles is very costly, and investing in this equipment and tools shows the auto accident collision repair facility's dedication to their trade. Computerized estimating ability, unibody (frame) equipment, paint booths, welding equipment, and paint mixing stations are a few examples of this equipment.
(2) Tour the shop and look at the quality of work. Examine finished jobs and jobs in progress.
(3) What is the condition of cleanliness and orderliness, or is everything just a mess?
LOWEST PRICE MAY NOT BE BEST FOR YOU. You deserve to have your vehicle repaired, and for the repairs to hold up over time. The auto accident collision repair shop with the lowest estimate in NOT going to be best for you if they got to that position by cutting down on quality of parts and labor that the others are dedicating to the job.
Although price should not be much of a factor (the insurance company is paying), it pays to remember that you get what you pay for in most cases. A cheaper estimate often results in a cheaper repair. A cheaper repair can jeopardize your investment-typically the second largest you'll make, as well as your safety. Keep this in mind when considering price. Check to make sure one reason for the lower price is not the substitution of foreign-made imitation parts for genuine "Original Equipment Manufactured" (OEM) parts. As noted elsewhere on this site, there are times when a consumer is not entitled to OEM parts because his vehicle-because of mileage and usage-is so far beyond the useful life of the parts that using OEM parts might entitle the insurance company to a claim of betterment for improving your vehicle. But for other, more recent vehicles, there is no arguing that OEM is the gold standard.
ASK ABOUT THE AUTO BODY SHOP TRAINING PROGRAM. In this auto accident repair business, the newer vehicles are so complex that a garage owner cannot possibly hope to keep up to speed on all of the changes for all of the vehicles unless he pays for his staff to attend off premises training programs. Among the most widely recognized and respected of these programs I-CAR. Participation in training programs is another way to verify a buisness' commitment to quality and customers.
DO NOT FALL INTO FRAUD AGAINST THE INSURANCE COMPANY. Some consumers think that it is smart to find an auto body shop owner who will "play along" with them so that they can avoid paying their deductible on their first party claims. What would you say if the shop owner told you that he could hide or "bury" your deductible if he rises up the price of some items to be paid for by the insurance company? DO NOT GET INTO A RELATIONSHIP WITH A DISHONEST AUTO BODY SHOP OWNER! Once
you get him to agree on cheating on the deductible, you have no idea whether he
is also going to cheat you. A shop that will comply with this request may be
simply cutting corners on the repair, not discounting the parts and labor. The
question to ask yourself is how many corners will they cut-just enough to save
your money, or will they cut as many as possible and make an additional profit
also? What will you do if his work turns out to be unsatisfactory? If you vary from the agreed repairs in any manner through your requests, you may be extremely disappointed with the outcome of the repairs, and you will have very little grounds to seek restitution if you are dissatisfied.
Tortfeasor The one whose NEGLIGENCE caused the accident and who may or may not have insurance. (Note: be sure you ALWAYS state that you are the victim of negligence, and NOT EVER the victim of an intentional act; insurance ONLY covers negligence, and never intentional torts.)
Third Party Carrier The tortfeasor's insurance carrier.
First Party Carrier Your own insurance carrier.
Comp/Collision coverage Your own first party comprehensive (damage from sources OTHER THAN AN AUTO ACCIDENT) and collision (AUTO ACCIDENT) coverage.
Towing/Rental car coverage First party coverage clauses that we recommend each insured add to their policy ASAP. Inexpensive coverage and a darn good investment that pays enormous dividends if you should ever need it.
"Preferred Shop", "Approved Shop" or the like An auto collision repair facility that has been licensed by the insurer to write estimates for it and to repair from those estimates. This can save the insurer from having to hire its own adjuster to travel around and write his own estimates. BUT be careful that they are not selected because they agree to shortchange on the repairs.
DRP: Direct repair or referral program This is where they use those preferred or approved shops. This does have some potential for disadvantage to you if participation in the program is dependent upon siding with the insurance company when it comes to the overall quality of the repairs. But in our experience, many fine independent shops also participate in such programs for a number of insurers, so one should investigate the extent of the commitment to the insurance company required of the shop owner.
"Steering" This is a practice where some insurers will attempt to recommend, direct, encourage, or otherwise influence a consumer to use a repair facility selected by the insurer.
Depreciation This is the natural and expected decrease in value due to age, wear and tear, and the like.
Deductible This is the amount that you must pay if you use your own insurance to do the repairs. Look at it like the "copay" on a health insurance policy. You selected this amount when you bought your insurance and it is the amount of the repair cost you are responsible for when filing a claim with your own insurance company. Common amounts are $500.00 and $1000.00. With a higher deductible, your premiums are usually lower.
"OEM PARTS" These are the parts manufactured either by the maker of your vehicle, or by its authorized facility. Also referred to as Original Manufacturer's Equipment.
"Aftermarket" parts, "Like Kind and Quality Parts", or "Quality Replacement Parts" These are the parts made by some unknown shop overseas and are pushed by the insurance industry as a cost saving for their insureds. Since they are usually not of the same quality or fit as the OEM parts, sometimes customers will hold out for even a used OEM part rather than a new Aftermarket part.
Betterment or Upgrade This is a charge that the insurance adjuster might try to collect from you if the repairs or replacements increased the value of your vehicle. For example, what if you got new tires because your worn ones were punctured in the accident? Or what if you insisted on a new OEM generator for your eight year old car instead of accepting a rebuilt one?
"Pre-loss condition" This is the goal of your auto body repair efforts. It is supposed to be as close as possible to the condition your vehicle was in the instant prior to an accident. You are entitled to be made whole by restoring your vehicle to its pre-loss condition or by compensating you if that cannot be done. The insurance company is not obligated to make it better than it was, however, they can not force you to accept anything less.
Pre-loss elements defined Here are the elements of pre-loss condition that one should consider to ensure your vehicle is restored. (1) Function. Do all of your automotive systems work, including things like the systems that relate to stopping, steering, and handling of the subject vehicle? (2) Appearance. Here the condition of all areas of the vehicle should be restored to at least the same appearance of the subject vehicle just previous to the accident. (3) Safety. This is a most important, but frequently overlooked area, probably because most consumers have no idea what to look for. Who among us would know how to figure out whether or not the SRS systems (which control airbags and seatbelt pre-tensioners, etc.) have been set correctly or whether or not the vehicle has been restored to withstand a subsequent impact and absorb that impact and protect the occupants as designed by the manufacturer in the same manner as an undamaged vehicle? (4) Value. Has the including restoration of the subject vehicle to a value equal to the value of the vehicle just before impact?