ASA commends those shop owners willing to step forward and actively organize coalitions to help educate policymakers about the impact insurer-owned shops have on the collision marketplace. For assistance in these efforts, be sure to visit ASA's new legislative Web site, www.TakingTheHill.com. The site provides a wealth of information on automotive legislation efforts and offers a sophisticated grassroots program unmatched in the industry.

After a strong showing in California and bill passage in the state of Texas, policymakers have set their sights on a number of insurer-owned shop bills around the country. Eight states now have legislation introduced and there is increasing interest in a number of other states. Arizona, Florida, Michigan, Iowa, Hawaii, Maryland, Missouri and Minnesota have bills at various stages of the legislative process.

Although the message of the legislation is clear - no insurer-owned repair shops - the bills do vary in their approaches to resolving the problem. Let's take a brief look at some of the bills in play:

ARIZONA

House Bill 2298 has a number of co-sponsors and would halt insurer-owned shops in Arizona as of July 1, 2004, if it becomes law as is. The bill does allow for insurer-owned shops in business prior to July 1 to operate with certain restrictions.

Arizona collision repairers banded together to form the organization, Fairness for Automotive Consumers (FAC). The group includes Arizona Collision Repair Facilities, the Arizona Collision Craftsman Association, Automotive Service Association, Arizona Auto Glass Association, Arizona Automotive Recycling Association and the Arizona Professional Towing and Recovery Association. FAC is the principal proponent of the legislation.

FLORIDA

House Bill 1503 and Senate Bill 2692 have recently been introduced. The House bill has been referred to the Committees on Appropriations, Insurance and Agriculture. The bills prevent insurer-owned repair facilities unless the shop "was open for business, or on which construction had commenced, on Jan. 1, 2004 ..." Similar to the new Texas insurer-owned shop law, the bill puts tough restrictions on those shops grandfathered in the bill's language.

MICHIGAN

Senate Bill 819 and House Bill 5460 have been introduced in Michigan. The Senate legislation has received the most attention. S. 819 prohibits insurer-owned shops, but allows for a two-year divestiture period for those shops already having insurer ownership interest. The Senate Banking and Financial Institutions Committee has held two hearings on S. 819. The Automotive Service Councils of Michigan has been working overtime to ensure the legislation has its best chance for passage. The first hearing played to a room packed with independent repairers in support of the legislation. ASC testified, as did ASA.

These are just some of the bills being considered. Repairers are meeting in other states to plan for bills to be introduced later this year or to be pre-filed in 2004 for the 2005 legislative sessions.

Collision repairers are building coalitions and organizing their grassroots members to achieve maximum support for their legislation.

ASC of Michigan illustrated in its recent Senate Banking Committee testimony the fragile "checks and balances system." In this three-part system - the insurance company, the consumer and the repair facility - all have a role in the process. If repairers are removed from the process and checks and balances are eliminated, the consumer loses.

Specifically, ASC pointed out:

The insurer's primary focus is to reduce the cost of repair. Its primary responsibility is to the stockholder, not the policyholder. Success in this scenario demands a system of cheaper and quicker.

The consumer is totally dependent on the insurance company without the independent repairer in place. If problems occur, who does the consumer go to? The opportunity for redress is eliminated. The consumer's right to choose is eroded.

Allstate Insurance Co. has challenged the new Texas statute on insurer-owned shops in federal district court in Dallas, Texas. The suit involving the Texas attorney general will not go to trial until the fall of 2004.

Repairers interested in pursuing insurer-owned repair shop legislation or in learning more about those bills introduced on the issue should go to ASA's new legislative Web site at www.TakingTheHill.com.

ASA foresees more legislation being introduced in the coming months. ASA commends those shop owners willing to step forward and actively organize coalitions to help educate policymakers about the impact insurer-owned shops have on the collision marketplace.

Bob Redding is the Automotive Service Association's Washington, D.C., representative. He is a member of several federal and state advisory committees involved in the automotive industry. For more information about the legislative activities of ASA, visit www.TakingTheHill.com.

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