Auto Body Shops Appeal to Government for Help
Local auto body repair shops are looking to the provincial and federal governments to help in their fight against insurance companies and their alleged unfair practices.
Truswell Collision Services, Bracebridge Collision, All Star Auto, John's Collision Shop and Turner Auto Body in Bracebridge, T & M Autobody and Midway Autobody in Gravenhurst, and Muskoka Collision in Huntsville banded together recently to place a half-page ad in local newspapers to alert consumers to their rights under the Insurance Act, in particular, the right to choose a repair shop.
Representatives from the group recently met with Parry Sound-Muskoka MPP Norm Miller at his constituency office in Bracebridge, and with MP Tony Clement at his office in Huntsville to find out how the government may be able to help with their issues.
The coalition of repair shops alleges insurance companies, as a group, are moving toward the use of one large, impersonal direct repair facility for all collision claims, bypassing community retailers and service shops in the process. Collision clients are directed to the favoured repair shop, with the claim that it is faster, has better warranties or that the insurance company can intervene if the client is not satisfied with the work.
“There is a lot of insurance fraud … including fraud committed in auto body repair shops,” said Mark Klein, manager of media relations for the Insurance Bureau of Canada, the national industry association that represents Canada's private home, car and business insurers. “This is driving up premiums for consumers and it certainly seems to me to make sense for insurers to investigate and make arrangements with preferred shops in order to protect themselves.”
Besides the alleged risk of fraud at shops not recommended by the insurance company, Klein said other reasons a certain shop may be favoured include the quality of work, or the one-stop experience, where the shop does all the paperwork, provides its own appraiser and may also have a loaner vehicle on-site for the customer.
“It's well within insurance companies' rights and prerogative to suggest shops they're comfortable with,” said Klein. “There may be very good reasons why an insurance company prefers certain shops. Having said that, no one is obligated to go to those shops.”
However, the local auto body repair shops allege that many of the insurance companies are not conveying this message to their customers and are actually violating the consumer's right to choose by bullying them into believing the opposite, that they do not have an option.
“It's a conflict of interest because the truth of it is you as the insured have interests that are your own — they are your car, the quality of repair and the parts you get on your car — and the insurance company has an interest too,” explained Dale Truswell, owner of Truswell Collision Services. “Your interest and theirs are not necessarily the same.… When they direct you to a shop that they choose, whose interests are being served? Yours, the insured, or theirs, the insurer?”
After meeting with the concerned auto repair shops, Parry Sound-Muskoka MPP Norm Miller said he is sympathetic to their issues and asked them to put their concerns in writing so he can direct them to the relevant authorities, including the Financial Service Commission of Ontario, the minister of finance and the minister of consumer services.
“I'm certainly going to follow it up,” said Miller. “I would also encourage any individuals who have felt they didn't have a choice to contact my office and make me aware of the specific circumstances. That will help.”
Although the laws and regulations regarding auto insurance fall under the provincial government's jurisdiction, Parry Sound-Muskoka MP Tony Clement said some serious issues about competition and market power, which are a federal concern, were also raised during his meeting with the auto body repair group.
“The best thing to do is to refer it to an expert whose job it is to review the practices of businesses and industries and then to identify anti-competitive behaviour and deal with it,” said Clement. “I will certainly do my job as MP to get them connected to the right people.”
Clement has also asked the group to gather their concerns, evidence and any indication of improper behaviour by insurance companies in writing, so he can take it to the federal competition bureau on their behalf.
According to Keith Turner of Turner Auto Body, the auto body repair group hopes to have their paperwork in order for both levels of government soon. Though the group is hopeful they will get some results through the government avenues, their main concern is to raise awareness among consumers.
“It's just amazing,” said Turner. “In the month that we've been doing this, just the knowledge and people talking about it may be the best thing that ever happened.”
To learn more about your rights as an auto insurance consumer, visit the Financial Services Commission of Ontario website at fsco.gov.on.ca.
Courtesy Kim Good , Jacqueline Lawrence, Bracebridge Examiner/Gravenhurst Banner
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