Contact:	Clarence Mills (202) 543-1440 c.mills@att.net
For Release:	Immediate News Bulletin PR-59 October 1, 2008

California Paint Cap Bill Signed by Governor

WASHINGTON, D.C., October 1, 2008 - California state Senate Bill 1371, titled "Insurance: Automobile Repair Capping," was passed by the state Senate Aug. 8, 2008, and has now been signed by Gov. Arnold Schwarzenegger.

Bill 1371, authored by state Sen. Lou Correa (D), would prohibit insurers from capping paint and materials charges. The latest definition of capping, which was approved July 14 by the state Assembly, is "... offering or paying an amount that is unrelated to a methodology used in determining paint and materials charges that is accepted by automobile repair shops and insurers."

The bill does state, however, that if pricing agreements involving discounts are reached voluntarily between auto repair shops and insurers, that capping rules do not apply. Otherwise, the methodologies for calculating the paint and materials charge, which must be accepted by both automobile repair shops and insurance companies, is determined by multiplying refinish unit times the refinish rate. Other price-determining factors include manuals and estimating systems that estimate how much refinish will be required to repair a certain part of the automobile, and software programs that automatically do the calculations.

The Automotive Service Association is the largest not-for-profit trade association of its kind dedicated to and governed by independent automotive service and repair professionals. ASA serves an international membership base that includes numerous affiliate, state and chapter groups from both the mechanical and collision repair segments of the automotive service industry. ASA's headquarters is in Bedford, Texas.

ASA advances professionalism and excellence in the automotive repair industry through education, representation and member services. For additional information about ASA, including past news releases, go to www.ASAshop.org, or visit ASA's legislative Web site at www.TakingTheHill.com.

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