NICB Sends Bulletin to All Insurers About BodyShop Solutions.

July 4, 2007 by
Filed under: Collision Repair Industry 

I received a phone call the other day from an insurance appraiser friend of mine that confirmed a rumor I heard. That rumor started here on this site a couple of weeks ago when some insurance person left a comment stating that the National Insurance Crime Bureau had issued an alert to all its members warning them about the software sold on this site. I could not confirm it because NICB does not post these alerts on their website. Apparently only paying members have access to this information. I ignored the rumor because I had heard nothing else. Well it is no longer a rumor. It is fact.

When my appraiser friend called to give me the heads up, he was laughing because the alert was sent by email and it included a link to the tutorial for my Parts Bill Helper. I checked the hits on my website and sure enough, thousands of hits from insurance company servers. They were all taking the tutorial. In the past Progressive and State Farm were the most frequent visitors to my website, but now they have some serious competition.

I called NICB to find out why they issued this alert, and to have a little fun. After speaking to a couple of people, the nice woman connected me to the person who she said had wrote the alert. Unfortunately, due to legal issues, this man could not 1) confirm that the alert was issued, 2) confirm that he had written it, 3) comment on it at all. I would have to speak with their legal department. A couple of days later someone from their legal department returned my call. I asked what the thought process was behind this alert. I knew damn well what they were thinking but I wanted to here it from them. This attorney wouldn’t bite. He told me it was simply an informational alert. It contained nothing but a notice and a link. I asked if he could email me a copy because, after all, I was the subject of the information in question. He told me he couldn’t. That information was for members only.

So before I go on and forget, any of my insurance personnel readers who have the gonads to forward a copy of this bulletin, I would greatly appreciate it. You will remain anonymous.

Now I freely admit that my new C.I.A Technology is controversial. There is a disclaimer at the beginning of the web page that explains it. NICB simply pointed to that disclaimer as their rational behind their alert. They feel that my disclaimer is an admission of guilt for some sort of nefarious plot to defraud the insurance industry out of their precious pennies. Unfortunately for the NICB, and many of my loyal readers, reading comprehension is not one of their stronger assets.

Because several readers have commented negatively on this website about Parts Bill Helper, and I have found some negative discussions on other non collision industry forums, I am going to spend some time explaining my reasoning behind this software. I hope that when I’m through, readers will understand that not only did the NICB overstep its bounds by issuing this alert, but that the arrogance of the NICB and their insurance company members is unmatched in today’s business environment.

BodyShop Office with C.I.A. Technology is not something I dreamed up overnight in hopes of retiring young. It is a collection of tools that I developed for my use at my shop over the past years to Combat Insurer Abuse. That abuse, specifically, is the insurance industry’s refusal to pay for things without seeing our private business invoices. I can think of no other business or industry where the payer asks for and receives the personal business documents of the seller. Notice I said payer and not buyer. The insurance company buys nothing. That’s very important to remember. Insurers believe they are the buyer, the customer. That is one of our largest problems. The insured has paid his premiums, sometimes for decades, and when time comes to collect on his insurance policy, the insurance company is obligated to reimburse that insured for his loss, or for the loss he caused to a third party.

Insurers abuse their control of this money and actually engage in coercion and racketeering. After years of this abuse the public, shop owners, legislators and judicial branches of state and federal governments now just assume insurers are the buyers of our services. That mentality must change.

If you don’t understand that, or disagree with that statement you can stop reading now. You’re helpless and hopeless and wasting your time visiting this site.

Now let’s talk about fraud and devious behavior. For decades insurers hustled shop owners into believing that marking up a sublet tow bill and actually making a profit on money spent repairing cars was illegal. These are smart people in these insurance companies. Who honestly believes they didn’t know that there is nothing illegal with making a profit on a business transaction? Because all states must regulate towing and storage rates for non-consensual towing, and us dumb bondo brains don’t know any better, insurers perpetuated the myth that all towing was regulated. It is not.

There were a handful of shop owners who knew better and were marking up tow bills for years, but most shop owners still, today, believe it is illegal. After all, the insurance companies say it’s illegal. Who besides me issued an alert to body shop owners warning them that the insurance companies were engaging in fraud by lying about the legality of marking up tow bills. Where was the NICB then?

Because insurers are so set in their ways they insist on seeing the bill from the towing company that brought the wreck to your shop. You have a vehicle that is clearly not drivable, yet they want proof that the vehicle was towed to your shop. How the hell else would it get there? Because most companies refuse to pay you a mark up based on your towing vendor’s cost to you, I developed Tow Bill Helper to satisfy insurance appraiser’s irrational need to see your costs. No other business I can think of allows its customers (the insurance company is not the customer) to see their costs and then decide how much profit the business can make off of their purchase. Would a mechanical repair shop show a customer its invoice from NAPA for the exhaust system they installed on the customer’s car and then let the customer determine how much above the shop’s cost they were willing to pay? The thought is so ridiculous, yet most of us operate like this every day. Many of you say you have nothing to hide and have no problem handing over your invoices. That is not the point and has nothing to do with this rant.

The insurance company has no legal right to see what you paid your towing vendor. No court, not even the courts filled with socialist judges, would be able to find in favor of an insurer who claimed they had the right to this information. An insurer’s refusal to pay you the cost plus a reasonable profit for a sublet tow without disclosing your cost is extortion. Tow Bill Helper offers relief from this extortion. It allows the shop owner to present a tow bill to the insurer without disclosing the cost.

The NICB’s alert was specific to my most controversial software, my Parts Bill Helper. They consider it fraud.

My reasoning behind Parts Bill Helper is also to combat insurance company extortion. Any retailer who sells anything must determine his cost of doing business, his desired net profit (return on his investment), and the necessary gross profit margin needed to meet that net profit goal. Gross profit is the difference between a products cost and selling price. Every business will have different needs, and their local market will have influence on the range of prices. The range of prices. The RANGE of prices. Only the retailer can determine where in that range his prices will be. And there are many other factors that help a retailer determine his prices. Those factors include quality of product, level of service, type of customer base, location of the business and level of competition. Prices vary.

Insurers believe prices should not vary. Every retailer (collision repair shop) should charge the same. This is preposterous! More importantly, this is price fixing. Only the government and the insurance industry can get away with price fixing. Go figure.

If you decide you need to bump up the retail prices of the parts you install on a wreck, the insurance company will refuse to pay the difference. Your customer, the vehicle owner, would probably have no problem with paying a few percent more for parts. Maybe they love your service. The world is full of people who will pay a premium for good service, convenience or prestige. Many businesses cater to these people.

If you want to charge more than manufacturers’ suggested retail price for parts, that is your choice. Prices vary! But as we all know, insurers refuse to release any more of their insureds’ money beyond the list price. In fact, they often refuse to pay anything unless you can produce your invoice for your purchase of these parts. They use extortion to see your invoices. Don’t show them your invoices and they don’t pay. Even though the new part has clearly been replaced; even though they can see the old part laying on your shop floor, the insurance company requires the appraiser to collect copies of your invoices before they will pay for any additional parts. If you want to charge more than manufacturer’s suggested list price, the insurer will refuse to pay any more based on the list prices on the invoices they insist on seeing.

Remembering that insurers have no legal right or authority to view your invoices, their holding back payment until you cough them up is extortion. Extortion is illegal but don’t hold your breath waiting for the feds to correct this injustice. Enter Parts Bill Helper, the fraudulent scandal that prompted the NICB to warn its members.

Parts Bill Helper assists the body shop owner who wishes to defend itself from insurance company extortion. It allows you to import the parts list from your estimate, quickly enter your costs for these parts, calculate the total gross profit on these parts so you can determine if it’s adequate. If the gross profit is not adequate you are able to enter your desired gross profit and update the sale price of the chosen parts. Once the sale price has been adjusted you are able, with the permission of your parts vendor, to produce an invoice with the new sale prices that resembles your vendor’s invoice. This is strictly for increasing parts prices. If you use the software to bill for parts that you did not use in the repair, I will personally lead the angry mob to chase you down like a child molester and throw your ass in jail.

Anyone who is a regular reader here knows that I despise dishonest body shops. They are responsible for most of our problems. Billing for parts not used is still a problem in our industry. It is my belief that insurers should work hard to catch the scumbags that are running their businesses this way. In fact, I have turned in body shops after reinspecting repairs and finding this type of fraud, only to be told by the insurance company that there was nothing they could or would do. It was up to the customer.

In some parts of the country insurers are working to catch the turds of our industry. I applaud them. I would assist them. I would work with them to put these crooks out of business and in jail. All they would have to do is ask. There is no excuse for committing fraud to make a profit. But preventing an insurance company from violating your rights and using coercion to damage your business is not fraud. It is self defense.

So I ask you, where is the fraud? Are my intentions and inventions anything but honorable? I have simply supplied the victims with tools to protect themselves. Used honestly, no reasonable person would find fault with your resistance to insurer thuggery.

The irony of the NICB’s alert is unmatched. The insurance industry engages in fraud, coercion, extortion, price fixing, intimidation, strong arming, threatening, and racketeering, and earn obscene profits while you, the collision repairers are forced to run you businesses outside of the capitalist system. You do have a choice. You can reclaim control of your business, but most of you haven’t the stomach for it. So you submit.

I offer some rational and creative help for the submissive, and I’m the crook. It is akin to me offering someone a gun to protect himself and his family from a gang of thugs the police refuse to arrest and put in jail. Aside from the anti gun, socialist whack jobs that infest our cities, who would fault a person for taking up arms to defend his business, his life, his families life? Because when it comes down to it, your success in business helps you to care for your family. If an insurer runs you out of business through corrupt tactics that government officials refuse correct and protect you from, they are threatening the well being of you and your family. There is no more important responsibility for a parent or head of family than the protection of that family.

On that same note, insurers have every right to protect themselves from body shops and vehicle owners who conspire to defraud the insurer. But it is not fraud to charge more for your service our your product than the shop down the street. It is fraud to charge for parts and services you don’t provide. NICB’s concern is misguided. Yes, my software could be used by one of the many crooks in our industry to steal from consumers and insurers, but those same crooks have been doing it in the past without my software, and they will continue to do it in the future. Again, it is people who commit crimes, not the tools and inanimate object crooks use in the committal of these crimes. Unfortunately there is a large segment of our society who believe people are not responsible for their own actions. It is the outside influences, guns and information that makes people commit crimes. People who think like that are the greatest threat to our liberties.

I suggest to NICB that they extend their alert to include Microsoft, Adobe, Corel and other software manufacturers. They all create software that allows one to create invoices. Anyone with Microsoft Word can achieve the same results. It’s just going to take a little more work.

I consider the NICB alert a badge of honor. I have got their attention. You have got their attention. The collision repair industry is finally fighting back, trying to save itself. Insurers have not been left unscathed. They have finally pushed us too far and have pissed off enough repairers. Hopefully these repairers will do more than the usual whining and complaining.

I know much of what I have just written here will be misquoted and misunderstood. That’s fine. Some folks are just wired wrong. And they often only see things the way they want to see them. Again, that’s just dandy. My conscious is clear. I remain true to my moral beliefs.

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Comments

34 Comments on NICB Sends Bulletin to All Insurers About BodyShop Solutions.

  1. Independent Business Owner on Thu, 5th Jul 2007 4:53 am
  2. Try not to stress your self too much. A true independent knows how to operate his/her business in order to earn a profit. Marking up a sublet is standard business practice for true independents. If you are a DRP or one of the many owners (mostly technicians turned owners) out there who really have NO clue as to how to operate their businesses, perhaps one day you will realize that business is not about trading dollar for dollar. Then again those on the Concierge programs are actually spending $1.00 and getting at best $0.75 cents in return. Do the numbers folks.

    John, keep up the good work.

    ps. Is there a chance that this memo libels your company?

  3. Roger Walling on Thu, 5th Jul 2007 6:26 am
  4. John,

    I applaud you work on educating body shop owners on the true facts of “Profit is not a dirty word”.

    Ma. Auto Damage Licensing Appraisers Board has just issued the newest ruling on Paint& Materials and Body materials. The ruling states that shops may, if they wish, use the Mitchell P&M Guide or other documentation to determine the cost of said materials.

    I am concerned that the insurance companies will now attempt to coerce shops to use this cost , or lower, as a figure for repayment of said costs.

    The true facts are, however, that no business is allowed in Ma. to sell at cost, under the penalty of law! The figures that the Mitchell Guide represent are the cost to the shop, not the selling costs to the customer of the shop, the owner of the car!

    I have even had appraisers state that they will only “allow: the shop to “Mark Up” the price 25%.

    As you so eloquently stated “…quickly enter your costs for these parts, calculate the total gross profit on these parts so you can determine if it’s adequate. If the gross profit is not adequate you are able to enter your desired gross profit and update the sale price of the chosen parts…”

    There is nothing wrong with selling your paint for a profit; it is just like any other part that you purchase.

  5. Wade Ebert on Thu, 5th Jul 2007 6:26 am
  6. Hahahahah.HAHAHAGggaFFF cough wheeze…

    What schmucks! Too Funny!

    Know that the NICB was created by insurers, for insurers, to serve as a Faux authority, to “instruct” police agencies, provide “free” study materials etc.. Now some of what they do makes a good amount of sense. I sat through a seminar/class for Police agencies of my state in which the NICB was a participant. This was previous to the establishment IN FACT that the one of the nation’s largest insurers had INTENTIONALLY CONCEALED the histories of and FRAUDULENTLY TRANSFERRED – FRAUDULENTLY TITLED vehicles back into the stream of commerce: FOR A PROFIT. (a practice that continues to this day)

    What did the NICB do about that? Nada. Not a flippin’ thing.

    I however had the privelege of pointing out the pending issue to the NICB “instructor” and a room full of peace officers from various agencies statewide. My query started like this: “What will the NICB likely do when it is revealed that Major Insurance companies who sponsor and provide funding to the NICB have and are; with intent to defraud; trafficking salvage – in many cases dangerous vehicles, with washed titles back into the stream of commerce?”

    The answer from a carreer “insurance investigator” representing the NICB was a non – commital barely audible mumble something like “that remains to be seen.”

    Rest easy John, the NICB is a shill – a shadow agency. They have no prosecutorial authority. They have nothing but insurance paid lackies on staff but that is reason enough to poke them with a sharp stick.

    Hey do me a favor: Give me those phone numbers and maybe an e-mail, I need them for an unrelated story I’m writing. Aannnd I was looking for something the other day – I have to wonder if they have a copy – of my “permanent record” from grade school.

  7. Brandon Dingwell on Thu, 5th Jul 2007 2:54 pm
  8. For those that say marking up parts over msrp is illegal or wrong, what do they think of the dealers that do it. I called Mercedes a few weeks ago to order a trim part and inquired of the price. The parts man told me it was $116.00. When I commented that that was quite a bit higher than my crash book showed he stated ” we’ll that’s the walk in retail price price. MSRP is $97.00 and your cost is $77.60.” Dealers constantly sell parts higher than msrp. Nothing wrong with that at all.

  9. Mastertech on Thu, 5th Jul 2007 3:17 pm
  10. John:
    You are aiming at the right targets, just keep firing away.

    You need to contact BSB and all the other trade rags that are not toilet paper and sell some software. I have almost made as much money with Towbill helper as I have with Paint ex.

    Keep up the good work.

  11. Tim on Thu, 5th Jul 2007 4:50 pm
  12. Are mark-ups in any state regulated in any industry? I have heard in California it is 50% but can’t find the answer anywhere.

  13. Ernest A. Wisniewski on Thu, 5th Jul 2007 5:11 pm
  14. John,

    With the logic they are using they should be questioning the salvage yards, who buy their total losses for 10% on the dollar, for the settlement figure of a claim, then turn around and make 100’s of percent in profit when the sell the parts right back to fix new vehicles with parts that were deemed junk.

    I don’t think that will happen; insurance companies want to perpetuate this practice, because they are making a profit themselves over what the value of scrap iron would be to selling for when the car totaled out.

    Or how about what the aftermarket companies import a container load of fenders. I heard the cost of parts like this was somewhere around $20.00 a copy. The insurance will pay 100’s of percent in profit for this scrap, because the are in bed with these importers to hold the cost of a repair down so they can make a profit.

    If I were you; I would welcome the investigation, just make sure everything is publicized on the news. The repair industry needs this kind of information disclousure, showing who is making all the money and who has been defrauding the American consumers.

    Ernie

  15. Scott Anyan on Fri, 6th Jul 2007 9:00 am
  16. Right on the money as usual, John.
    Keep up the battle.

    Scott

  17. Lou Ann on Mon, 9th Jul 2007 8:24 am
  18. WISH YOU WERE LOCATED IN GEORGIA. WE NEED YOUR HELP!!

    I WAS LUCKY ENOUGH TO RECEIVE A PHONE CALL FROM ONE OF THE MAJOR INSURANCE COMPANIES, AFTER I RAN AN ADD IN A LOCAL NEWSPAPER INFORMING POTENTIAL CUSTOMERS OF THEIR LEGAL RIGHTS WHEN IT COMES TO CHOOSING A BODY SHOP, I WAS TOLD IN NO UNCERTAIN TERMS, I NEEDED TO WATCH WHAT I SAID IN ORDER TO CONTINUE TO DO BUSINESS THEM.

    GUESS WHAT, WE ARE STILL IN BUSINESS!!!!

  19. James on Wed, 11th Jul 2007 9:32 pm
  20. My name is James. I know about this site because I have a friend who is an Insurance Adjuster and he was discussing this site and the products sold here. I also have several friends that have or are car salesmen and probably 15 yrs or so ago by grandfather owned a small salvage yard and tow service. I run a small business so I understand the balancing act of profit margins and losses. Those are my connects to this industry, whoever minor. I have read a lot of what is posted here. As your everyday person I would like to give my opinion on a couple of these issues. The first is parts mark up, invoices, and who can see invoices. To begin I have no issue with mark up as you do have a bottom line to consider. I do disagree with the idea that no one should be able to scrutinize what you do. My example of this is that I had recently had to have a minor mechanical repair on my car at a dealership. My adjuster friend gave me an idea what the cost should be. The shop quickley quoted me aboout double what I was expecting as an initial estimate without taking anything apart. I told the shop to call me with the actual estimate. The shop called me and gave me the estimate which was acutally a little more than their initial. We went over and the difference was a part price. I questioned this and advised the shop their part price was well over double what my friend told me it should be. I called four other dealerships and got prices and part numbers. I called the shop and went over this. I was told I was wrong and I had the wrong part number. I finally got the part number the shop was using. I called these shop’s own parts dept and the told me it was the wrong part. Now the shop is mad a me for calling them out but i would have had no way to know if not for my friend. The other issue I saw was tow bill mark up. From my understanding shop will mark up a tow bill anywhere from 25% to 33% of the amount of the tow. Why wouldn’t you have a set fee for this. It costs the same to write the check if the bill $200 or $500. Sorry about the long post. I’m not sure if I agree with many of the things I see here, but I do think that at the very least this is a good place for your side of this issue to be seen and if a few higher ups in some companies saw this and understood your complaints better maybe there could be some middle ground on some issues.

  21. Scott Anyan on Thu, 12th Jul 2007 6:39 am
  22. Just a couple of responses to James,
    1 James states he is a small business owner, Do you show third partys your invoices for things you purchase for retail sale.
    2 If you think you need someone to scrutinize part markups from your service vendor, you need a new mechanic.
    If you had a friend who knew about furniture prices and you went to a furniture store and they tried to sell you a couch for double, would you ask to see their invoices or simply go to a more trustworthy store.
    Its unfortunate you had such an experience, but if you routinely read Johns comment you should know that he despises dishonest shops and created his software for honest shops who are just tired of fighting to make an honest living.
    3 You are correct that writing a check costs the same regardless of the amount, but tying up a shops money until an insurance company gets around to paying for the tow does make a difference whether its $200 or $500
    Bottom line consumers should be able choose their service provders and if they get burned not patronize that vendor, as it is in almost every other segment of society.

    Scott

  23. James on Thu, 12th Jul 2007 9:57 pm
  24. Scott,
    I appreciate the response to be able to have another point of view.
    1.Just to clarify I only run the business I don’t own it. We are more of a service business but we do purchase items that the cost is factored into the cost of our service. My point to seeing an invoice in this case for my repair wasn’t really about price but more about the item I was purchasing, the price doesnt need to be seen by me the customer. Much like when I, and I’m sure yourselves get products in, I check the invoice to see that they match what I am purchasing I do this as much as possible in every aspect of life. I think, from my view, you describing your self as a retail business isn’t really the most accurate. When I go in to buy a couch I see what I am buying. I know up front generally what I want and with a little reseach ruffly what I should pay. But with shops a customer brings in the car having no real idea what’s wrong, what parts might be needed, or a rough cost. The shop tells me what’s wrong, what the cost roughtly should be, and most customers make an uninformed decision over the phone without any real clue about costs about whether or not to proceed. To the shop I am using , I’m by no means am calling them dishonest, but if they were a dishonest shop how can I look at hand written receipt or a receipt that they input whatever data they want to on it and know that’s correct. I guess the point is that your really not a retail business, you are really much more. Your business is one of intellegent, hard working, skilled people that because of the amount of knowledge that you have far exceeds that of the average person you really have to be held to a higher standard because of the potential for abuse.
    2. The point about loaning the insurance company money is look at that as your cost of doing business. I will preface this statement with the fact that I do get a portion of my fees up front, but I have expenses that I pay for that arent covered by this amount and I don’t get paid for these things plus my and my employees time until everything is over and paid for. From my understand from my friend and what I have read here you are out the tow bill until it’s paid for but you get paid for the things you agree to do at that time with the exception of parts price differences. It’s also my understand, and if this is not true please correct me, that as a shop you have tow services that you primarily use and recommend to customers and in return they try to send customers to you, which is a very smart business practice I might say. These tow services would charge me one price but if the tow service knows that the insurance company is paying then the price is higher. Then the shop and the tow service both make more money.
    3. I absolutey agree that as a customer I does have the right to choose whomever they want to provide me my services. Also if I don’t like the service I received I wont go back there and I will tell everyone I know to not go there.

  25. Scott Anyan on Fri, 13th Jul 2007 5:31 am
  26. James, you make very valid points, but i think we are getting off track a bit.
    The main point here is that as an honest business owner I personally would have no problem showing our customers [the vehicle owner] an invoice if they really had a problem, but still maintain that insurance companys have no business seeing anything from my business other than an estimate or final invoice.
    I think this comes down to the misbelief that insurers are our customers, they are not, the vehicle owner is.
    The insurers job is to reimburse the owner the cost of repairs.
    I agree we should be held to a higher standard, but not by insurance companys.
    If an insurance co. believes we have done something fraudulent thay can inspect the vehicle or have someone knowledgeable inspect it, I personally woud welcome the scrutiny, I think ti would help to weed out the scumbags like the ones you mentioned in your original post.

    Scott

  27. James on Sun, 15th Jul 2007 10:46 am
  28. Scott,
    I do agree with you that in the end the vehicle owner is the actually customer and that it is the job of the insurance company to pay for the cost of repairs. I guess I do need you to clarify something for me to be able to duscuss you statement. When you say final estimate or invoice do these have part numbers on them to be able to verify you are purchasing the correct part and if there is difference in your figures and the insurance company’s estimate?

  29. Scott Anyan on Tue, 17th Jul 2007 6:56 am
  30. James, no they do not, as I said we would do whatever was required to make sure our customer was completely satisfied in every respect.
    The computer programs that we use as well as ins. co’s, have part #’s and prices in them but they are frequently wrong.
    That is why estimates say subject to final invoice.
    We would never want to order an incorrect part as that would only slow production, cost us time & money, and often irritate our customers.
    Bottom line is I think most if not all your concerns would disappear if you had a truly honest shop.

    Scott

  31. Wade Ebert on Tue, 17th Jul 2007 7:59 am
  32. James,
    I agree with Scott and his response.

    I only wish to point out the irony – which we as repairers have to endure every day. As a pretty sharp consumer – you express concern when you mention “…if there is difference in your figures and the insurance company’s estimate…”

    The reality is, ***Unless*** there is a difference between the final invoice generated by the actual repairer and the estimate/paperwork provided by an insurance captive source – you got ripped off. And the conspirators – did what they do every day – a generally well below average job repairing your car and a great job concealing it from you.

    I wish it were not true.

    The starkest of reality is: The relationships between repairers and insurers should never be. No repairer is legally qualified or legally bound to you in order to negotiate on your behalf, but it happens every day. The shops on Programs have already negotiated away your rights to a complete repair when they signed a contract before you even wrecked your car – a contract that you will never see. Whether or not you are in insured or a claimant against an “at fault” insured, the relationship – between the insurer and the repairer – the restrictions -the limitations – the requirement of the use of salvage part and non – OE parts, the requirements to depart from the specific repair methods of the manufacturer, will NEVER be revealed to you. The DRP contracts have a confidentiality clause that binds the repairer to conceal those details from vehicle owners, or be removed from the “Program”.

    Is it legal? Probably not. Who can find out? You: when you ask your Attorney General.

    The “un – secret” of our industry. Hiding in plain sight. As legitimate as a playing card conjured by the hands of an expert magician. The un-holy unions that serve to the detriment of consumers are played off as “pro – consumer”. The insurance mantra is “if we have to pay claims, we’ll only have to raise rates.”

    The un – secret of our industry is every bit as legitimate as the relationships “enjoyed” by insurers who held those contracts over the heads of the Gulf area engineering firms in the wake of Katrina. Many were defrauded by the conspiracy. In that case, insurers had no fear of even the Federal government as they shifted wind losses to the Federal Flood Insurance Program.

    Something must be done. While in homeowners losses, the homes just are not built, in Auto losses the cars are hacked up and sent out again. If those cars kill somebody the next time the structure is called upon to do its job, the evidence is consumed in the collision or the crusher that follows.

    Doubt me? Print this and take it to any bodyshop and ask. Better yet, now that you know what kind of double speak to look for – send you concerns to your Insurer and ask them to explain it. Then send all of it to the AG with specific comments that such relationships are not the “business of insurance” and therefore not regulated by anyone other than the AG. That ought to be fun.

    When insurers face the revelation of their bad actions, they merely offset the bad press with ad money. They saturate the airwaves and sports event sponsorships with their massive advertising budgets selling their good hands / good neighbor / ever vigilant / we’ll take care of you image.

    Plato provides the most salient perspective:
    “This and no other is the root from which a tyrant springs; when he first appears he is a protector.”

    What will you do now James?

  33. Northern Arizona Auto Claims Service on Mon, 30th Jul 2007 5:53 pm
  34. No one says your not entitled to make a profit. And you as a shop owner can dictate what that profit is. After all it’s a free country and our ecomomy is based on a free market. The problem I have is the way your going about it. I have been a shop owner and a claims adjuster. Creating these invoices is never going to fly with the carriers. They just won’t respond well to it. And they will resist it with all the power and money thay have at their disposal.

  35. Wade Ebert (a guy with a real name) on Mon, 30th Jul 2007 8:50 pm
  36. I’m feeling like I just can’t let the ignorant live another day. “Respond well to it”? LOL. – The concept upon which Shortell predicated the idea create the ability to make the invoices – is: the ridiculous belief that insurers should see anyone’s invoices, at ALL EVER!

    There exist only three things more ludicrous:
    1.) that some people actually think that repairers should CARE how they respond to it.
    2.) that some people would be shocked to learn that repairers are not obligated in any way to GIVE ACCESS to such things.
    3.) that some “claims” people think that they are part of the collision repair industry.

    Let me help you there – Flagstaff, no name person whose business name doesn’t even come up on Google – who doesn’t know the difference between “your” (possessive) and “you’re” (the contraction of “you” and “are”) and I won’t even comment on “thay”:

    God love you because somebody has to. Listen up Bunky ’cause I ain’t gonna repeat it. The Jig is up on this insurance thing. Those escaping unscathed have been counted. You may be among the lucky (although illiterate) few. Enjoy that.

    If you can read better than you can write – do so indulge me, won’t you? In my state insurers routinely ask that repairers create entirely false invoices – but that’s not all Skipper – no sirreee bob! They ask that repairers engage their suppliers in this effed up conspiracy to create false “documentation”. It happens EVERY day. It starts like this “Oh yeah I know paint caps are capricious and arbitrary and illegal besides but just have your paint vendor dummy up somethin’ that shows the number you want and we’ll get closer.”

    IDIOTS!

    I don’t care what you insurance folks do, I bill the only customers I have, the ones who turn the keys in the ignition. AAAAASssssssss it turns out – Not only do repairers feel better about telling you (ahem – excuse me) insurance folks to go jump in the lake, but tahmpt tah dahhhhh! in so doing they are actually acting in the only correct legal manner in the given circumstance.

    Which is exactly why when any insurance jamoke is silly enough to send me anything with a signature line which appears to create an “agreement” between the repairer and the insurer, I throw that in my “goes to AG at next meeting” pile. See Falgstaff – Them igreed figgers tain’t legal neether.

    Tell me where you are and I’ll bring you a whole truckload of good old Midwestern common sense. I haven’t had a good Chorizo and Eggs breakfast since the last time I was out there and I’m about due.

    If you’re feeling froggy have Shortell give you my real e-mail address.

    I’ll meet you at Cal Thur’s office in the valley, then we’ll all do lunch. Interested?

    Okay I’m done with this guy – NEXT!

  37. James on Mon, 30th Jul 2007 11:19 pm
  38. Wade,

    To begin with there really is no need to be an Jack AAAAASssssssssss to people over word syntax because the other person has a differing veiw of thints than yourself. It is very easy to make mistakes in word usage when you are typing. North Arizona does appear to have a certain amount of perspective that you don’t as he has done the job from both sides.
    I would like to respond to a comment from a prior post that you stated that insurers and shops dont have to right to have an agreement on what they will or wont pay of the vehicle owners behalf. Large corporations like Wal-Mart and Target do the same thing every day with manufacturers every day to get the suppliers products into their stores. The manufacturers give up some of their profits to have their product in stores before someone else does.
    And in relation to parts usage from my what I see it appears that state laws allow for other than original parts to be used. Also I went back through my policy and it is also discussed in there. If you have a problem try being informed. I got a flier from Jeep in the mail as junk mail the other day stating that if I have a Jeep and wanted an insurance policy that would would use only original parts for a Jeep then I should purchase through them. This was what prompted me to look through my own policy. As I do have a Jeep so I looked into it. If wanted this I would this I would have to pay quite a bit more. I look at it the same way I look at most other items in my every day life. I buy and use item that are generic every day. Whether these items are drugs, food, or any other items day to day for my money most of the time the generic version is fine. I know that if I want to original I can pay the difference. The same way with repairs. I now understand what will be paid for and if I want to pay the difference I can. There is a real good chance that if the the shop owner actually gave me chance to choose I would choose the less expensive of the two.
    You stated that there should always be a difference in the shop estimate and the insurance estimate. I asked my friend about this statement. I will give you his response and I would like your thought on this. First he stated that many repairs are subjective in two ways. He felt that multiple people from multiple shops or companies could look at the same damage and estimate it differently based upon their experience and training. And that the amount of actual time for the repairs required in that this is based upon the skill of the repair person. For example the adjuster may say a dent requires 4 hours and the shops states 5 hours. They agree on 4.5 hours and the repairer actually does it in 3.5 hours. Second is that there is some difference in the software that is used and the amount of time for repairs give in each software set.
    I hope I didn’t have any mistakes that would cause you to be more of an AAAAASsssssssss. There really is no need to be rude.

  39. John Thomas (not my real name) on Tue, 31st Jul 2007 9:43 pm
  40. James,

    If reality is rude, then that is what you get brother.

    Is there a way to tell you that you and your insurer friend may be incapable of grasping what I am telling you – and not appear to be rude…. to you? I think not, still I will try – tomorrow.

    ‘Til then, I give you this to ponder: When your car hits mine and your policy says “caveman repair car mud and sticks” how does that apply to me?

    I’l be back for my answer in the morning.

  41. Scott Anyan on Wed, 1st Aug 2007 5:24 am
  42. James,
    Maybe i’m getting your post wrong, but do you really want an insurer and repair shop negotiating the repair of YOUR car.
    Again I think your missing the point
    Do you really want an insurer and shop deciding if YOUR car should get OEM or immitation crap parts.
    Or as John Thomas says, what if someone hits your new car and the insurer, yours or theirs wants to mud up your fender or put crap parts on your car, I think you would be singing a different tune.
    The biggest point here is any negotiating should be done between the shop and the vehicle owner, the insurer has no place there.
    Ever heard the saying “don’t take advice from someone who owes you money”.
    How about “don’t let the fox guard the hen house”.
    If you reply to my post, if nothing else please answer this one question, do you really want an insurer who is paying for repairs to be deciding how YOUR car is to be repaired.
    Can you say CONFLICT OF INTEREST.

    Scott (my real name)

  43. John Thomas (not my real name) on Wed, 1st Aug 2007 12:41 pm
  44. Well James,

    Did you ask your insurance friend about your mud and sticks policy yet?

  45. James on Thu, 2nd Aug 2007 12:36 am
  46. Scott,
    I do understand what you are saying about the insurer and shop, but only to a point. You really have a catch 22. You are saying that there is no one to check the insurane comany, but if you negotiate directly with the vehicle owner who keeps you in check. How do I know when something is repairable as opposed to needs to be replaced. What keeps you from looking out for yourself when you’ve had a slow couple of months and you can make more money from replacement over repair. There has to be a balance. In the end neither you as the shop or the insurance company have best interest at heart you both are running business for one reason only. To make a profit. Neither of you are looking to lose money or even break even. Everyone, myself included, wants as much as they can get. In the end if you don’t make some profit you find something else to do.
    I would like a little clarification to the mud up statement. I’m not exactly sure what that means. I will make the following statements working under the assumption you are talking about repairing items. Once again its not for me as the average person to really be able to make the distiction between repairable and must me replaced. But I do know that if me kid put a hole in the wall I can mend that hole and repaint it and not have to replace the entire wall. I do also know that if my wife hits my garage wall with my car I will need to replace those 2×4 that are broken and the sheet rock that is damage to a point ( I know from experience), but the whole wall doesn’t have to be replaced. When I some to what replacement parts can be use and who makes that decison. Of course in the end I would rather have the new original part, but I went onto my states department of insurance site and look there and look at my policy I don’t that right all of the time. The web site states that the consumer bill of rights must be written in the policy and they approve all policies. Whether or not I feel this is right is really not the issue. The issue is this is what the law allows. The law allows this whether you are insured with the company paying or not. It’s my understanding that most insurance companies are set up this way.
    Scott you asked “do you really want an insurer who is paying for repairs to be deciding how YOUR car is to be repaired.” I would like to have a part in certain decisions. But that is why I pay my insurance company, because I don’t have the knowledge to deal with a shop as knowledgeable as my adjuster is supposed to. If I don’t like what I hear from another insurance company if they are handling my damages then I have the right to go to my company. If I’m not happy with either I as stated in a prior response I will pay for the difference to have what I want if I want it. And after all is said and done I will find an insurance company that give me what I feel I deserve if mine doesn’t. It really comes down to this one thing. The average vehicle owner does not nor should not be expected to have the knowledge the shop or the adjuster is supposed to have and we really am in a no win situation because you dont’ trust them and they don’t trust you.

  47. James on Thu, 2nd Aug 2007 12:53 am
  48. John,
    Just so you know I come here to acutally learn something. I tried to be as informed about as many things as I can. I like to see both side of an issue. This is why I have taken the time to post and read as many post as I can. I would appeciate rather than you sounding like a bitter, angry, ignorant little man you acutally discuss the topics as the intelligent person that I am sure you must be from your knowledge of the english syntax and not just rail against someone. I am trying to educate myself about this process from anyone, including yourself, that has that knowledge and experience and is willing to share it from all sides. I once read that if someone is happy with an experience they tell 5 people about that experience, but unhappy people tell 10 people. I think that with sites like this those number is multiplied many times over. I’m sure I’m not the only person coming here and reading the post. If you rant and rail and seem unintelligent with arguments that is what other people will pass along to others about the people in your industry. This I feel would be a great diservice to you and people on your side of this issue.

  49. Northern Arizona Auto Claims Service on Thu, 2nd Aug 2007 12:22 pm
  50. An insurance policy is a contract between two parties. Both parties have rights under that contract. If you don’t like the terms of the contract don’t buy it. You can always pay more in premiums to get OEM rather than A/M or LKQ>. When a vehicle’s owner signs a repair order with your shop he is agreeing to allow you to repair his vehicle with the understanding that his contract(policy) with his insurance company will be enforced on both sides. A shop can not create phoney invoices, or use replacement parts that are not covered under the terms of that policy contract.

  51. Wade Ebert (a guy with a real name) on Thu, 2nd Aug 2007 2:17 pm
  52. Two Tier Policies are not commonplace. Most companies hold themselves out as paying for repairs which serve to restore the vehicle to pre -loss (which is of course open to interpretation). When a vehicle owner signs a contract of repair with my shop it is entirely separate from their contract with their insurer. The policies that afford the insurer to write for counterfeit or salvage parts are also limited by state laws which require that the parts be “at least equal (to OE) in terms of fit, quality and performance. SOME salvage parts may fit this requirement but I’ve yet to see any AM (counterfeit) parts that meet that standard. Certainly establishing the equality of “performance” of a “crash part” that has never been tested in a dynamic destructive test is NOT possible.

    Ultimately as affirmed by several DOI’s on several occasions: since the REPAIRER bears the direct liability for repair choices – the REPAIRER is the SOLE arbiter of whether the parts meet the standard set forth by each state.

    Insurers created CAPA and keep CAPA alive to do their bidding. Counterfeit crash parts listings often include parts that have never even been made. How legitimate is that? They systematic efforts by insurers and those contracted to them to underestimate repair losses is a fraud against the consumer.

    The agreements/contracts/agreed figures between repairers and insurers are LESS legitimate than the agreements that insurers had with the engineering firms in the aftermath of Katrina. At least there, the firms were hired BY the insurer so the consumer had little reason and no legal reason to expect the reports to be skewed against them.

    In the collision repair scenario the repairs are often dictated by secret deals established between two businesses which benefit both of the business entities but serve to the dertiment of the consumer. These deals are also often written with a confidentiality clause (and where none is written the effect of “steering” the work away from legitimate repairers – to the “secret keepers” is the same). The clause requires that the repairer KEEP SECRET from the vehicle owner – the details of the provisions and limitations of that agreement/contract/agreed figure. Where I’m from they call that a civil conspiracy to commit consumer fraud.

    As to what a repairer can or cannot do or what parts they can or cannot use that is not for any insurer to determine. Except one perhaps – the garagekeepers liability insurer. Which has an absolute exclusion for intentional acts. Intentional acts predicated on an agreement that is outside of the contract of repair established with the owner of the vehicle… pretty much slams the door on any liablity coverage should anything go wrong. If the repairs result in a diminished value issue because the course of repair dictated by the outside agreement affected the vehicle’s qualification as a Certified Pre Owned trade in. No Coverage. If the OE warranty (which is now lifetime and transferrable in many cases) is partially or wholly nullified. No Coverage. If the car is “clipped” against manufacturers recommendations and is thereby structurally compromised. No Coverage. If someone dies in that clipped POS. No Coverage.

    Some garagekeepers insurers even mandate that NO used suspension components may be used to affect repairs. And rightfully so.

    Now if the insurer partnering in any way with the repairer creates an uninsurable risk – how can that be good for the vehicle owner? In my state repairers are REQUIRED to have such a policy in force in order to be licensed. So – if the common business model “forces” repairers to behave in a way that “suspends” their coverage – the shop is operating as an illegal enterprise.

    It has been pondered recently that Farmers/Zurich is playing both ends of the field in providing coverage that participation in their COD program affectively nullifies. That friends and neighbors is a fraud against an entire industry – and the consumers of its good and services.

    Shall we discuss third party losses now? I love the idea that the insurance industry has programmed its personnel to say “we treat them all the same” with regard to the difference between insured (first party) losses and claimants against insureds (third party losses). No injured party can or should by any agreement or device be made subject to the provisions and limitations of a contract (policy) that they have never seen – let alone never have signed. If it happens, any attorney worth his salt can and should have every individual and business entity involved in such a scheme – for breakfast on behalf of the innocent party. Consumer fraud generally pays treble damages and requires the forfeiture of licenses and affords for attorneys fees.

    Perhaps it is time I made a trip your way. You folks should know this by heart.

    For your enjoyment I’ve included in a secondary post an email exchange I fostered with about two hundred participants. Read carefully the comments of the garagekeepers insurance agent who responded by agreeing with my premise.

    It reads in reverse order so the first thing you will read is him THANKING me. Enjoy.

    W.

  53. Al Pollack,Northern Arizona Auto Claims on Thu, 2nd Aug 2007 3:09 pm
  54. I actually agree with most of what you said. As a licensed Adjuster in the State of Arizona. I have NEVER been a big fan of insurer’s who all but insist customers use their “Direct Repair Facility”. It was determined years ago that that insurer’s can not direct consumers where to have their cars fixed. And for some reason DOI’S are looking the other way now. The question is why is that? What has changed in our industry to cause this? From my point of view the body shop industry has brought it on themselves. It seems to be the only way the insurer’s can control the quality of work that they pay for. Not that that’s right but they think it is. Recently many insurer’s that I write for have eased up and no longer interfear with my agreed prices or second guess my estimates. The consumer has actualy forced a noticable change in policy. Including paint caps and OEM parts. Then you come along with these computer programs to change ligit invoices and tow bills. Just when things were getting better. I have heard from no less than four carriers in recent days about what you are doing. You need to ease up and let the market take it course.

  55. Wade Ebert on Thu, 2nd Aug 2007 5:50 pm
  56. Well nice to meet you Al.

    Let’s see if that email exchange I mentioned will stick this time. I think you’ll find it interesting. It kept kicking out cause I’m too wordy I guess. Just so you know I don’t use the invoicing program although I think it’s not a bad tool for those that need it. Some insurers would like repairers to finance their operations by providing no interest loans for Towing and such. I mark mine up and get paid. It is that simple. I seldom if ever show invoices that show my costs.

    By the way, SF is now putting their Select Service shops on a special SF credit card account for buying parts from its specified parts vendors. SF gets a big ol’ kickback check at the end of the month from its selected parts vendors – it was mentioned to me “just like they do from Home Depot on building supplies” Hmmmm I wonder what those Katrina Victims will think of that?

    Anyway let me try to put up that e-mail.

  57. Wade Ebert on Thu, 2nd Aug 2007 5:51 pm
  58. Wade,

    Thank you. As mentioned, if I can help you in regards to this DRP problem, you have my full support.

    I am shocked with the “Tortious Interference suit” threat. I would have liked to see how that one may have played out in court.

    Wishing you and the industry the best!

    Sincerely,

    Rob Gion, Jr.

  59. Wade Ebert on Fri, 3rd Aug 2007 7:07 am
  60. Well I give up, Shortell’s software for this blog apparently thinks I use too many words. I’d be glad to sent you the emails – by email.

    If you folks want a boatload to read, slide on over to the prodiscussions.com groups. My email is readily available there as is an archive of the drivel I and many others write. That way we don’t hijack John’s site.

  61. Scott Anyan on Fri, 3rd Aug 2007 7:25 am
  62. James,
    I really can’t do better than Wade’s post.
    I would add though, are you aware that many insurers are hiring kids right out colledge and train them to write estimates only according to their procedures and they have absolutly no collision repair experience whatsoever and many don’t know any more about a car than what the computer tells them.
    Many company’s actually won’t hire someone with experience.
    So again I ask, Are these the people you want as your advocate.

    I realize it may be a task, but the answer is still to find an honest shop who cares about you and your car, believe it or not we do exist.

    Scott

  63. Steve Havener on Mon, 13th Aug 2007 6:33 pm
  64. Wade,
    Give em hell little bro.
    Steve

  65. Skitch Davis on Sun, 23rd Sep 2007 3:15 pm
  66. For my parallel thoughts on all the above matters, search out page 10 the June 2007 issue of BodyShop Business. Then find the eighth page of the June 2007 of FenderBender magazine as well.

    I have decided that adjusters are not to leave my shop laughing. They can reimburse us for the services we perform, or just leave. They can then explain to their insured why we refuse to provide slip-shod repair work.

    A big-wig of the now remaned Universal Underwriters to Zurich, during our monthly SCRS-MOKAN meeting, was making a ‘keep your shop safe to save us claim dollars’ pep talk. I quizzed him in regards to how many of the claims of which he had ‘percentaged’ to hell, ( x-percent were wheel-offs, x-percent were cliams of tripping over an air hose, etc.) were the result of the afore-mentioned “insurer-partnership” contract style of un-insurable intentional act, side contract type, they they screwed up and paid out on……

    Boy did a room full of nearly a hundred shop owners and managers get real quiet as this fellow gave me the most profound dumb look I have ever seen!!!

    Yes we have in the past been ‘massaged’ into financing their claims. It is every shop owners’ own fault, mine included. I did not realize, until now nearly too late that we have all, mostly unknowinglyand innocently, assisted the Insurance Cartel in molding our entire industry for their own personal use…

    I am into regaining my portion. I am fixing what is broke by charging for what we do, completely ignoring Cartel Messengers, and repairing my customers’ vehicles properly and professionally. Threats, intimidation, slander, defamation of character, and coersion are hitting the high spots. The Mckinsey method of zero-sum accounting is working quite well for them also…..

    Hope no one here is offended by my post. I am just in the mode of thinking that I have never lowered my self to buying work, so why would I do such by signing up to a DRP butcher contract to loose money on repairs while accepting all their (uninsured) liability and risk loosing what I have eeked out of this lousy profession as a facility owner in the last thirty-five years???

    Once again, thanks for the board! Keep up and at!

  67. Bodiman on Tue, 9th Oct 2007 4:19 pm
  68. John, you go Man, anytime you get the insurers attention like that, you know your on the right Blood trail, dude it’s hunting season so go get your Harvest! LOL

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