bob
01-17-2009, 01:25 PM
Press Release
The Commonwealth of Massachusetts released a special report last week on auto body labor rates. Collision repair shops say they are paid one of the lowest hourly rates in the country. Insurers claim Massachusetts shops take 6hours longer to repair the average vehicle, and as a result, costs here are some of the most expensive in the nation. It’s an ugly mess. And one in which neither side wants you to hear the WHOLE story.
“During the period of 2004-2007, 249 Forensic Reinspections were completed on repaired vehicles. The vehicles where repaired at 146 different registered shops in Massachusetts. 205 had work not completed as negotiated and paid for.”
“Average amount of variance is almost $900 for 2007” - Commerce Insurance Company
That appears to be a fraud rate of 82% and $900 on the average repair. It is very important that consumers understand that Commerce Insurance is comparing repairs to their own cost estimates. They did not repair the vehicle. Repairs need to be judged to the repair shop’s invoice, not insurance company internal loss reserve documents (estimates). That is unless the shop is part of the insurers referral program. What would be very interesting to know is how many of those 146 shops were part of the Commerce referral program. Its all part of that ugly mess mentioned earlier.
“Unacceptable high incidents of fraud in the auto repair process”- Commerce Insurance Company
You bet it is. What did they do about it? They didn’t say.
“The auto repair industry is a classic example of an industry in which consumers have difficulty knowing (with certainty) the quality of the goods or services the have purchased.” “Auto repair service problems are likely to be even greater when repairs are paid for by automobile insurance.” -Sharon Tennyson, Economist and Associate Professor of Policy Analysis and Management, Cornell University
Here at Wreck Check of Boston, we absolutely agree. Many shops and insurers prey on unsuspecting consumers.
Don’t believe that it’s just a problem for Massachusetts consumers either. It’s a nation wide problem.
The California Bureau of Automotive Repairs said, “In 2007-2008, 522 BAR licenses received formal discipline. The BAR returned 6.3 million dollars to CA consumers in the past year in direct refunds, rework, or adjustments. A majority were for fraud related acts.”
For more information, visit us on the web at www.wreckcheckboston.com or email us at info@wreckcheckboston.com
The Commonwealth of Massachusetts released a special report last week on auto body labor rates. Collision repair shops say they are paid one of the lowest hourly rates in the country. Insurers claim Massachusetts shops take 6hours longer to repair the average vehicle, and as a result, costs here are some of the most expensive in the nation. It’s an ugly mess. And one in which neither side wants you to hear the WHOLE story.
“During the period of 2004-2007, 249 Forensic Reinspections were completed on repaired vehicles. The vehicles where repaired at 146 different registered shops in Massachusetts. 205 had work not completed as negotiated and paid for.”
“Average amount of variance is almost $900 for 2007” - Commerce Insurance Company
That appears to be a fraud rate of 82% and $900 on the average repair. It is very important that consumers understand that Commerce Insurance is comparing repairs to their own cost estimates. They did not repair the vehicle. Repairs need to be judged to the repair shop’s invoice, not insurance company internal loss reserve documents (estimates). That is unless the shop is part of the insurers referral program. What would be very interesting to know is how many of those 146 shops were part of the Commerce referral program. Its all part of that ugly mess mentioned earlier.
“Unacceptable high incidents of fraud in the auto repair process”- Commerce Insurance Company
You bet it is. What did they do about it? They didn’t say.
“The auto repair industry is a classic example of an industry in which consumers have difficulty knowing (with certainty) the quality of the goods or services the have purchased.” “Auto repair service problems are likely to be even greater when repairs are paid for by automobile insurance.” -Sharon Tennyson, Economist and Associate Professor of Policy Analysis and Management, Cornell University
Here at Wreck Check of Boston, we absolutely agree. Many shops and insurers prey on unsuspecting consumers.
Don’t believe that it’s just a problem for Massachusetts consumers either. It’s a nation wide problem.
The California Bureau of Automotive Repairs said, “In 2007-2008, 522 BAR licenses received formal discipline. The BAR returned 6.3 million dollars to CA consumers in the past year in direct refunds, rework, or adjustments. A majority were for fraud related acts.”
For more information, visit us on the web at www.wreckcheckboston.com or email us at info@wreckcheckboston.com