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United Auto Body Proactively Takes Steps to Protect Your Consumer RightsOpposition Letter Sent to California Senators Regarding Assembly Bill 1200August 20, 2009 Dear Sir or Madam: I respectfully submit to Your Honors my opposition of AB1200 which is authored by Assemblywoman Mary Hayashi and sponsored by the Personal Insurance Federation of California. AB1200, if effected, would be a bad law! Not only will AB1200 set back the auto body repair industry by allowing insurance companies more opportunities to steer customers away, but it would allow insurance companies to dictate and control even more auto body repairs. Many consumers are unaware that insurance companies have contracts with their auto body shops, also known as direct repair providers. These insurance-shop contracts dictate labor costs, material costs, parts usages, repair time, plus more! Since consumers are generally unaware of this, important laws have been placed to prevent steering by insurance companies. AB1200 goes against the very essence of the anti-steering statute. The verbiage in AB1200 supposedly would allow the insurance companies to provide to claimants with “specific truthful and nondeceptive information regarding the services and benefits available to the claimant during the claims process…” This is simply a cloak for insurance companies to steer customers away. The terms “truthful” and “nondeceptive” mean an insurance company may not misrepresent information, thereby not committing fraud. Insurance companies are already obligated to prevent misrepresentations and fraud to claimants. Thus, the bill’s purpose is nothing more than a way to get around the anti-steering laws which is currently in place to protect consumers. After reading the op-ed written by Assemblywoman Mary Hayashi, it is unfortunate that she fails to address important issues dealing with AB1200. Instead of stating why the opposition is incorrect in its position, she simply attacks the auto body industry by stating that the industry collectively is “challenged by fraud and misrepresentation.” Ironically, she fails to address how many of the complaints reported by the Bureau of Automotive Repair in 2003 were filed against auto body shops recommended by insurance companies. Not only is this particular statistic vague and ambiguous, it is irrelevant. The Assemblywoman’s other argument, that the opposition is led by those who have vested interest, is yet another red herring. To sum up Assemblywoman Hayashi’s arguments in her op-ed: the auto body industry is challenged by fraud and misrepresentation, the campaign is led by those with vested interests including trial lawyers who file frivolous lawsuits, the auto body shop organizations only have an interest in maintaining inflated auto repair prices for consumers, and bad businesses exist. These are her unsound reasons for passing AB1200. So what is the insurance companies’ vested interest in passing the instant bill? Any informed person can see through the fluff and notice that the main purpose is to steer work into insurance companies’ shops so that insurance companies can save money. To give you specific examples of the injustices by insurance companies that are occurring on a regular basis, I am attaching letters from my customers who have come in during the past, recent months. I am also attaching a declaration that was submitted to the California Department of Insurance by one of our customers for insurance steering. Passing AB1200 would create even more injustices for consumers because insurance companies would be empowered to pressure consumers to use the shops that the insurance companies have contracts with. Your Honors are in a powerful position to protect consumers from being taken undue advantage of. AB1200 clearly is not in the best interest of consumers and should be struck down accordingly. I can only hope that Assemblywoman Hayashi can also see that this bill is faulty and that she will vote properly to promote consumers rights. Respectfully yours, Mark Jannesari Owner & Consumer Advocate Opinions expressed in Ask Mark articles do not purport to provide legal or other professional advice. If such advice is needed, consult with your attorney or other qualified adviser. This publication is copyrighted by United Auto Body. The contents of this publication may not be used for any purpose without the written consent of United Auto Body.
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