On Sunday, October11th right before the deadline at midnight, Governor Arnold Schwarzenegger signed into law AB 1200. This bill supersedes existing “steering” regulation and makes it easier for insurers to “steer” customers.
What is steering? Does it have anything to do with beef? No.According to Thesaurus it means guiding, maneuvering or pushing.In order cut costs Big Insurance companies have signed contracts with selected body shops to do work for reduced labor rates and to use aftermarket or inferior parts. Insurance companies then suggested to their insured’s using these body shops guaranteeing the repairs. Prior to this bill it was illegal to” recommend “or steer customers to certain shops. Consumer has a right to pick a repair facility of their choice. With this bill signed Insurance Companies have the freedom to steer.
What is steering? Does it have anything to do with beef? No.According to Thesaurus it means guiding, maneuvering or pushing.In order cut costs Big Insurance companies have signed contracts with selected body shops to do work for reduced labor rates and to use aftermarket or inferior parts. Insurance companies then suggested to their insured’s using these body shops guaranteeing the repairs. Prior to this bill it was illegal to” recommend “or steer customers to certain shops. Consumer has a right to pick a repair facility of their choice. With this bill signed Insurance Companies have the freedom to steer.
“The California Auto body Association is very disappointed that AB 1200 was signed by the Governor,” said David McClune, CAA’s Executive Director: “I want to thank all of our members and other supporting industry groups that sent in hundreds of letters to the Governor asking him veto the bill.”
Doug Heller, Executive Director of Consumer Watchdog, a consumer advocacy group based in Santa Monica, California, has been leading the opposition to A.B. 1200. “The big lie (supporting the Hayashi legislation) is that insurance companies want to send people to their preferred shops to benefit the customer, when in fact they steer customers to insurance-controlled body shops as their way of controlling their loss payments. I don’t want a body shop cutting corners when they’re repairing a cracked axle on some family’s car,” said Heller.
“Isn’t it just plain wrong, “stated George Mondragon, Burbank Body Shop manager. Living in America we are accustomed to having freedom of choice. As is, Insurance companies have a lot of influence over their customers, who live in constant fear of their rates being raised for any infraction. We hear customers wanting to pay cash for their repair all the time, because they are afraid of their rates being raised. Many simply will do whatever their Insurance company will tell them to stay in their good grace.With this bill Big Insurance has more freedom to force their influence on consumers. And that is not good news for them.
But not all is lost. Remember, according to our constitution, citizens have a freedom of choice and in this case consumers have the right to choose a repair facility, no matter what anybody tells them. Stay tuned on updates on this controversial bill.
“Isn’t it just plain wrong, “stated George Mondragon, Burbank Body Shop manager. Living in America we are accustomed to having freedom of choice. As is, Insurance companies have a lot of influence over their customers, who live in constant fear of their rates being raised for any infraction. We hear customers wanting to pay cash for their repair all the time, because they are afraid of their rates being raised. Many simply will do whatever their Insurance company will tell them to stay in their good grace.With this bill Big Insurance has more freedom to force their influence on consumers. And that is not good news for them.
But not all is lost. Remember, according to our constitution, citizens have a freedom of choice and in this case consumers have the right to choose a repair facility, no matter what anybody tells them. Stay tuned on updates on this controversial bill.
