The Car and Truck Fleet and Leasing Management Magazine

Gov. Schwarzenegger Considering Collision Repair Bill

September 16, 2009

SACRAMENTO, CA --- California legislators have passed a bill that seeks to make it easier for auto insurers to persuade motorists to use company-selected facilities for their collision repairs.

But opponents of the legislation, who argue that insurers' direct repair programs are unfair to independent auto body shops, are asking California Gov. Arnold Schwarzenegger to veto the bill (AB 1200).

Insurance companies argue that the bill is necessary so that they can give their policyholders complete information about the benefits of having repairs performed at pre-selected auto body shops, the Los Angeles Times reported. Those advantages include lifetime guarantees, quick turnarounds and quality repairs, the insurers say.

But opponents of the bill contend that it will weaken safeguards against "steering." Opponents include some car dealers, auto body shops, trial attorneys and consumer activists.

If signed by the governor, the bill would change a six-year-old state law requiring insurers to tell claimants that they have the legal right to get their car repaired at any auto body shop they want. Insurers can now recommend taking the vehicle to one of their pre-selected facilities, but only if the car owner expresses no preference.

The proposed changes would still uphold vehicle owners' rights to choose a body shop; however, insurers would be permitted to continue providing information about their networks, even after motorists make an initial selection.

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