The Car and Truck Fleet and Leasing Management Magazine

New CA Body Shop Law Takes Effect

January 20, 2010

SACRAMENTO, CA --- This month a new California law took effect that allows insurance companies to discuss with their clients the benefits of using one of the insurer's direct-repair program (DRP) body shops. 

The new law replaces a previous law intended to prevent insurance companies from "steering" customers to DRP program collision repair shops. 

The new law, effective Jan. 1, allows insurance company representatives to discuss with claimants information about the repair warranties offered, the kind of replacement parts to be used, the expected time needed to repair the damaged vehicle, and the quality of workmanship available to the claimant. 

The law permits insurance companies to tell their clients "truthful and non-deceptive information regarding the services and benefits available to the claimant." 

In other California legislative news, a bill now before the California Senate seeks to change requirements for insurance companies wanting to use aftermarket parts in the repair of their clients' collision-damaged vehicles. The bill, SB 350, was amended Jan. 12 and sent to the Committee on Business and Professions. 

Existing California law prohibits an insurer from requiring the use of non-OEM aftermarket crash parts in the repair of an insurance client's vehicle unless that client is advised of the use of such parts in a written estimate before repairs are made.

But the bill now under consideration would instead prohibit the use of non-OEM aftermarket crash parts unless these requirements are met: 1) the parts must be at least equal to the original equipment manufacturer parts in terms of kind, quality, safety, fit and performance; 2) the insurer so warrants; 3) the insurer pays the cost of any modifications to those parts necessary to make the repair; 4) all OEM and non-OEM aftermarket crash parts, manufactured on or after Jan. 1, 2011, contain specified identification when supplied by auto body repair shops.

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