Insurance Adjuster Complains of Fraud by Repairers

March 21, 2007 by
Filed under: Collision Repair Industry 

I seldom respond to comments posted here under one of my columns. I have a good reason for that too. I’ve said my piece. I encourage comments and don’t want to discourage them by responding to them, especially the negative comments. Usually the only time I’ll respond to a comment is when I feel the comment is inaccurate or misleading, but not stupid enough to make it obvious the writer has no idea what he or she is talking about.

I feel the need to respond to a comment left yesterday by an adjuster who works at Midland Management, a claims handling company in the Texas-Oklahoma region. The adjuster–he calls himself Gary–responded to an article I wrote last September about arbitrary paint and materials caps. If you would like to read the article to refresh your memory, it is here. And following is Gary’s comment:

As an insurance adjuster, I have also questioned the legitimacy of arbitrary caps. However, you are being disingenuous to suggest that you’re being taken advantage of. First of all, many carriers will concede a supplement for materials upon documentation that said cap has been exceeded. Secondly, how many hours does it actually take to repair that little dent? I know a decent body man can repair the dent in 1 hour, but I understand the reality of estimating so I put 2.5 on the estimate.

Adjusters are people entrusted with managing someone else’s money. We get tired of the unscrupulous who try to rip us off every day. I get sick of shops that charge to R&I every piece they can dream up, only to find on reinspection that the part was taped off. I also get tired of shops wasting my time with .3 to R&I side molding, while at the same time forgetting to mention that they repaired a panel that I paid to replace. (This happened in an actual claim last week.) Funny how that worked out. The shop repaired the panel in less than 5 hours, but forgot to remind me to adjust the estimate for the 9.0 hours to replace the rocker panel and the $425+ part price.

As an adjuster with 16 years experience, I can assure you I have caught abuses by body shops many, many, many times. More time that I can every remember. Don’t waste everyone’s time with the “don’t color me with that brush” argument. If you deny participating in these excesses, you treat your readers as fools.

Let me start by saying that I take offense to being called disingenuous. I may be many things–a smartass, rude, obnoxious, a ball buster, politically incorrect, blunt, and sometimes, even a jerk–but one thing I am not is disingenuous.

Gary is correct when he says many companies will concede if the shop can show that materials costs are higher than the cap. Unfortunately, the premise of that argument is false. Caps are arbitrary, illogical and nonsensical. Even the simplest of simpletons can comprehend that the more area you paint the more materials you will need. That formula never varies, therefore putting an artificial limit on the amount of materials is merely a mindless attempt to cut costs and screw ignorant shop owners out of hard earned money. Since all three data providers allow you to set caps, they are complicit in the attempt to defraud body shop owners and consumers.

Because paint caps are so contrary to logic, it would be impossible for all three data providers to come up with the idea independently. Therefore, it was either a suggestion from the insurance industry, or one of the data providers came up with the idea and the other two shamelessly stole it. Either way, it doesn’t say much for CCC, ADP or Mitchell.

Gary’s second point, about paying 2.5 hours for a 1.0 hour dent is irrelevant to this argument, but I’ll address it simply with these equations:

  • 1.0 hour x $85 = $85
  • 2.5 hours x $40 = $100

Gary, you paid $15 too much for that dent.

As for Gary’s complaint about body shop fraud, I agree completely. If, that is, the shop negotiated with the appraiser for items and procedures and then failed to do them. That is fraud. If Gary can show that, and it probably wouldn’t take much effort, why doesn’t he turn the shop in? Why have insurers been turning their backs to this fraud for many decades? I have personally called an insurer to inform them of fraud committed against them by another body shop after completing a post repair inspection. The insurance company blew me off and told me it was between the customer and the shop.

The truth is, insurers understand that the same shops that commit all of this fraud are the same shops that are run by people too stupid to go head-to-head with an insurance company. These are the same shops that are working cheap because they have no idea how to run a business. If insurers are really so concerned with fraud, why then don’t they work with authorities to put these shops out of business? They know that 30 -50% of shops running today would be out of business, leaving much less ignorant, cut throat competition; the same moronic competition that allows insurers to pay labor rates half of what mechanical shops get.

That being said, the premise for this argument is also false. It is not the insurers duty to pay as little as possible for repairs. It is not even the insurers duty to pay for the repairs. It is the insurers duty to reimburse a policy holder or claimant for the financial loss suffered due to the accident. What that means is, taking commonly accepted industry standards for proper repairs and applying them to every estimate. The vehicle owner has no obligation to repair the vehicle. The insurer does have an obligation to pay every penny necessary to repair that vehicle correctly, even if the owner chooses not to repair it. That vehicle owner could take that money and put it in the bank until it comes time to trade in their damaged car. That money would make up the loss suffered when the dealer taking the trade offers much less than what the car would be worth had it been repaired.

Gary, along with most everyone else brainwashed by the insurance industry thinks it is his duty to pay only what is necessary–what he can get away with–not necessarily what the insured or claimant deserves. This false assumption is the root of many of the problems in our industry. Gary should not care whether a shop removes moldings or tapes them. Industry standards dictate that they should be removed. Gary should include removing those moldings in his estimate. What the shop does from there is between the shop and the vehicle owner, and not for Gary to loose sleep over. If the shop representative talked Gary into paying for something, knowing he wasn’t going to do it, Gary should put his money where his mouth is and initiate some sort of action against the shop. If he was successful it would be one fewer crook Gary would have to deal with.

Finally, I kind of feel sorry for Gary. It’s apparent by reading his comments that the areas he covers is full of butchers and thieves. No one wants to work under those conditions. People in that situation have a very hard time believing that there are honest people in the world, people they can trust. He asks me not to waste everyone’s time by claiming I’m not like all the shop owners and managers he deals with every day. He says that if I deny participating in this fraudulent behavior I will be treating my readers like fools. So I won’t explain that his world is artificially colored, and that he is the fool for thinking everyone else’s world stinks as bad as his. I’ll refrain from wasting my readers’ time by defending their intelligence.

While Gary’s vision of the world is like a bad dream, there are bits and pieces that reflect reality. Poor Gary needs to wake up and sort it all out before he wets his bed.

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Comments

28 Comments on Insurance Adjuster Complains of Fraud by Repairers

  1. JB3 on Wed, 21st Mar 2007 10:34 am
  2. I would bet there is actually more “insurer” fraud directed against the collision repair business, than there is fraud committed by the shops against customers and insurance companies. Starting with the abysmal rates at which we are paid, the artifically low paint & materials reimbursement, the inability to reflect actual costs of overhead, proceedures omitted even when required, etc. This is the most pitiful business with which I have ever been associated relating to fair payment for services rendered. And now we have to deal with insurance steering work to the lowest bidder. What a shame.

  3. bob on Wed, 21st Mar 2007 12:07 pm
  4. i agree with the fact that the insurance companies and adjuster do not get tough on fraud. i have seen it numerous times when we get cars into our shop that need to be re-repaired. the customer will complain that the shop (sometimes the insurance refererred shop) did not due what the estimate or final invoice states that they did. and some of the work amazes me how the shop can ever let a car leave in that kind of condition. The insurance adjuster will reinspect these cars and usually just ask the shop to pay them back for what the insurance company paid for and clearly wasnt done and then these shop just continue as usual until they get caught again and nothing ever happens.

  5. Earl H. Miller on Wed, 21st Mar 2007 12:16 pm
  6. John, Thank you for your ability to put into words what all the rest of us can only think.

  7. Truman Fancher III on Wed, 21st Mar 2007 12:52 pm
  8. It is very true that shops commit fraud on a daily basis. It’s how they make their profit. I always say that a shop cannot repair vehicles correctly, remain profitable while working for what most insurance companies are “willing” to pay. Shops that do this are charging somebody….if they want to stay in business. So I do put alot of blame on shops. I had an insurance adjuster ask me to have my paint store “make up” (i.e. INVENT) a materials invoice to which I told her “that is fraud and I will not be a part of that”. She shook from the word. I told her my repair order is her invoice and if that wasn’t sufficient I had an invoice from the Alabama department if insurance that said paint caps are a no-no….needless to say I got my materials paid for quickly.

    Adjusters…..turn these shops in. Stop turning your back on fraud while commiting it yourself in the way you write your estimates. If you are there to look after someone else’s money, as you say, then you can’t do anything but turn them in.

  9. Woody Owens on Wed, 21st Mar 2007 1:25 pm
  10. Gary, report the shops you say are defrauding you (your company) to the proper authorities or shut up.

    Could it be you are part of the reason the shops you deal with are cost shifting? Pay for every procedure needed at a fair price to the customer and leave the decision process to the car owner and his repair shop of choice, it is none of your business.

  11. Bob Isham on Wed, 21st Mar 2007 1:49 pm
  12. John’s response was perfect. It is true that a lot of shops resort to fraud in order to earn a profit when if they actually starting running their business correctly they would confront the insurers and demand fair payment. Our industry does create a lot of it’s own problems BUT the insurance companies still love the crooks (don’t crooks like other crooks). We have exposed fraud and cheating, together with sloppy and unsafe repairs and the insurers response has NEVER said “thank you” for helping us but ALWAYS “the bastard caught us again”.

    Until the insurance industry stops the lie, cheat and steal mentality from our indusry I doubt things will change.

    Smart shop owners can fix vehicles correctly and get paid fairly by confronting the insurer and using the vehicle owner’s power when it becomes needed. You must operate ethically, do everything you charge for and perform quality repairs. Those that can’t do this will forever have to resort to cheating.

  13. Chris on Wed, 21st Mar 2007 3:26 pm
  14. I find it interesting that if the adjuster leaves a needed part or procedure off the estimate(short sheet) he can simply say,woops, i forgot that,or didnt see it.Yet when a shop doesn’t do a procedure its FRAUD!FRAUD!FRAUD! Short Sheets are FRAUD. Adjusters need to be held accountable for what they write.

  15. Russell P on Thu, 22nd Mar 2007 5:33 am
  16. I went to a meeting the other nite that AASP held the speaker pointed out there was a poll taken the national average of body shop reports that buisness is up doing more work then the ever seen but profits are lower, many or these shops have been in buisness a long time. The insurance companies are reporting HIGHER PROFITES THEN THE YEARS BEFORE PROFITES IN THE BILLIONS. Whats wrong with this picture !!

  17. Mastertech/Bob Winfrey on Thu, 22nd Mar 2007 5:35 am
  18. Look at the pot calling the kettle black?? I have to work for my customer #1. But in my state NC Insurers rule with an iron fist. Complaints to the DOJ go unanswered and the DOI copies the Insurance companies response, Laws on the books are ignored by ALL. Attornies have lost their testicles. And there is nowhere to seek justice. I have to write an estimate to see it get cut by 40% and assist the customer in collecting what is owed under their policy for free. I had to get a letter from GM on their letterhead for a customer yesterday to prove aftermarket headlights and bumper did not meet O.E. standards. Fax it twice and hurry up and wait for SF to tell me it’s ok to order parts. Two Not on your side claims both full of aftermarket and LKQ LOL. I let the customers make all the calls but how much crap are we supposed to eat? Ille be waiting two weeks to get these other two straight, when they both could be fixed and riding down the road. All customers in rentals. How much do they save by jerking these people around??? I used to love my trade but so many outside influencea have their hand in it now my margins are razor thin.One repaint or delay and its lose your money. Oh and by the way “I do not have my deuctible can you help me out?”
    I guess thats what lets him sleep at night. We re all the crooks huh??
    LOL.

  19. James Michaud on Mon, 9th Apr 2007 1:40 pm
  20. Sounds like an adjuster that needs to learn how to repair a car or get a grip on life

  21. Fish on Tue, 10th Apr 2007 5:09 pm
  22. I’ve been on both sides of the industry, and been in the industry for over 25 years, as an ASE certified Master Collision Repair Technician, a shop writer/manager, and as a designated CPCU insurance claims manager. I will tell you loud and clear that paint caps or thresholds of any kind are complete and utter nonsense. The cost of refinish materials continue to skyrocket to new levels every year, and will continue to do so. Have you checked the price of sandpaper lately? You may as well be sanding with dollar bills. Last week I did a small refinishing project at home. The cost of one pint of RM single stage base white, a quart of reducer, and a quart of hardener was over $120.00!!!! About body shop fraud…I am as aggressive as a bulldog on this, and work very closely with the state Consumer Affairs division to pursue the bad guys and SHUT THEM DOWN!! I’ve got several notches on my pistol grip. Many problems of both industries can be tied to the shortage of people that want to enter the business, on either side. Do you know how hard it is to find a good body tech, painter or competent adjuster or estimator?
    The situation is perilous and getting worse every day. For the Collision folks that have never worked on the insurance side: Do you have any idea the amount of DOI rules and regulations that have to be followed to handle a claim to conclusion? Do you understand that all insurance premium rates must be approved by the state DOI? The state tells insurance companies how much they can charge! Do you understand that MOST insurance companies pay out more in claims than they collect in premiums? There are actually policies out with premium rates that average out to less than the cost of a daily Happy Meal!! If insurance rates are not kept affordable, people will simply drive without it, creating an ENORMOUS social problem as we’ve seen in several states. Lately, I’ve come across a new type of aggressive and rude type of customer that immediately assail my staff and make it impossible to help them. They want everything covered, expect the repairer to waive their deductible, and a bunch of free stuff to boot. This business is getting more and more difficult to survive in. I don’t know how much longer the good folks on both sides can last.

  23. fish on Tue, 10th Apr 2007 5:20 pm
  24. JB3 said,
    March 21, 2007 @ 10:34 am

    I would bet there is actually more “insurer” fraud directed against the collision repair business, than there is fraud committed by the shops against customers and insurance companies. Starting with the abysmal rates at which we are paid, the artifically low paint & materials reimbursement, the inability to reflect actual costs of overhead, proceedures omitted even when required, etc. This is the most pitiful business with which I have ever been associated relating to fair payment for services rendered. And now we have to deal with insurance steering work to the lowest bidder. What a shame.

    >>> Utter nonsense. If you ALLOW these things to be done to you, you only have yourself to blame. Man up and quit whining. Take a stand and hold your ground. The meek shall not inherit the earth or anything else. The meek inheret NOTHING.

  25. fish on Tue, 10th Apr 2007 5:28 pm
  26. Russell P said,
    March 22, 2007 @ 5:33 am

    I went to a meeting the other nite that AASP held the speaker pointed out there was a poll taken the national average of body shop reports that buisness is up doing more work then the ever seen but profits are lower, many or these shops have been in buisness a long time. The insurance companies are reporting HIGHER PROFITES THEN THE YEARS BEFORE PROFITES IN THE BILLIONS. Whats wrong with this picture !!

    Wait until the next Hurricane Andrew, Katrina, or Northridge earthquake. Those “profites” can disintegrate in short order. BTW the state mandates insurance companies to maintain reserve ratios to pay future claims obligations and to write new business! What you presume to be profit, is not always the case.

  27. Dev on Fri, 22nd Jun 2007 11:14 am
  28. Considering insurance companies pay for the lion’s share of all repairs done at most body shops, it is not unreasonable to expect accountability from body shops. We all know there are insurers who will screw body shops and insureds/claimants alike. Likewise, there are plenty of body shops who take pleasure in screwing insurance companies.

    Is it true what we’ve heard about this alert?

    “NICB has issued Strategic Alert SA 2007-070 regarding

    http://www.bodyshopsolutions.com.

    “This is a website that has software that allegedly produces false parts invoices.”

    Say it ain’t so.

  29. scott lehman on Sat, 15th Sep 2007 8:20 pm
  30. Lets get real here. The body shop industry shot themselves in the foot years ago when they got together and said they would all raise labor rates etc so they were on a level playing field. I forgot that that most shop owners are not that smart and said they would stay with the same rate and get all the work. I have been in the business for 35 years and nothing changes. I went from the shop to the insurance end and I feel sorry for the consumer because thats who is getting screwed. They dont know the shop has no one qualified to work on their car and their insurance company doesnt have anyone qualified to even look at it. All the shops that get into bed with the insurance industry will suffer a slow death.

  31. Craig on Mon, 4th Feb 2008 6:12 pm
  32. I have read the article and most of the comments posted. I have been in the automotive collision repair industry for 22 years. Needless to say I have seen allot of changes and really not one of them for the better. There will come a day when there are no worthy or able technicians to repair wrecks anymore. Today there is a huge lack of interest from people concerning collision repair. No one wants to do it anymore. It takes time to polish one’s skill to the point were the money is great andmost people don’t have time. They want to start making mega-bucks immediatly and when they see they can’t and when they discover the cost it takes to purchase tools in order to become a body technician most can’t afford it. I am a DRP facility for only one insurance company. I could have more but they all want concession’s that I am not willing to give. I read the articles posted concerning paint caps and for you people that don’t get it let me spell it out for you.
    LABOR RATES ONLY INCREASE ABOUT EVERY FOUR YEARS. THUS PAINT AND MATERIALS ONLY INCREASE ABOUT EVERY FOUR YEARS. HOWEVER, PAINT MANUFACTURERS INCREASE THE PRICE OF THERE PRODUCT EVERY – EVERY – EVERY YEAR. LIKE CLOCKWORK!!! ON AVERAGE IT’S ABOUT A 5% PRICE INCREASE. THROUGHOUT A FOUR YEAR PERIOD PAINT AND MATERIALS WILL INCREASE 20%. RECENTLY WE WERE ONLY BEING PAID $26.00 PER PAINT HOUR. WE HAD AN INCREASE IN LABOR RATES ($2.00 PER HR) SO TO WE HAD AN INCREASE IN MATERIALS TO $ 27.00 PER HOUR. THAT’S A FOUR – 4% INCREASE. SO OVER THE LAST FOUR YEARS MY COST ON MATERIALS INCREASED 20% FROM PAINT MANUFACTURERS AND ONLY INCREASED 4% FROM INSURANCE COMPANY’S. ********SEE THE PROBLEM HERE*********
    For a shop like me it’s a struggle to produce a profit. We use top refinishing products frm ground up. We don’t buy whats on sell this week from the back of a pick-up truck. We offer a lifetime written warranty so we have tu use the best. For us it’s our standard. For all you skeptics out there who sit behind a desk and audit and cut my estimate with nothing in hand but a couple of pics of the damage in the comfort of your quiet office while enjoying the view of the park across the street and having someone bring you coffee and doughnuts enjoy your time and your peacefull sorroundings because the day will come when your the only person stupid enough to breathe the air we breath, listen to the pounding of an air hammer for hours on end, struggle with matching a metalic paint on a hood cause you did’nt get paid to blend the fender, and perform mechanical services to only get paid around $40.00 less than the dealer across the street charges. Your day will come but I am betting against you. It will to much for you to handle so you will probably hone whatever other skills you might have and post a resume that to will get you out of the industry. Anyone can hook a scanner to car and read a bad o2 sensor but can you take a $15,000.00 wreck and remove the engine and transmission and replace from firewall forward. This I look forward to seeing.

    **************thanks for reading and if you feel the way I do let me know! Email me @ teamcollision07@bellsouth.net

  33. chris moorman on Tue, 15th Nov 2011 11:31 pm
  34. .Regarding paint and material caps. About a decade ago my shop owner came to me (I was the paint shop foreman then) and told me the insurers were putting caps on paint and materials and we were losing money but the adjusters said they would pay an invoice if we could provide one. So I got out the manuals for our mix system and what do you know there was a program built into it not only for invoicing but also job costing and tracking.So the next time these adjusters came in with a paint cap and then grinned and said but we’ll pay an invoice if you can provide one ,the shop owner grinned back and handed him one. This worked fine for a couple of years and still does with a few companies but many more have just started to refuse to accept invoices even though they know they are legitamite. I put on a presentation for an insurance company detailing the need for invoicing.We handed them three invoices one for a good hiding color with the lowest price code to refinish a new bumper cover one to repair and refinish the same cover with the same color and one to refinish the same cover with a poor hiding color of the most expensive price code (isn’t it funny that most of the poor hiding colors are also the most exspensive) needless to say there were major differences in price it was also noted that even the cheapest best hiding color could not be applied for what the insurer had on there estimate. The insurers had sent in an executive an attorney and there industry expert all agreed that the quantities of materials on the invoices accurately reflected what it would take to do the jobs we also agreed that there were huge desparaties in pricing and that at their rates we couldn’t perform the cheapest of the three repairs.The following are a few of there arguments and our resonses(1).You’re the only ones invoicing. That isn’t true although we can’t take you to other shops who are invoicing because that would be colluding and only the insurance industry is allowed to do that we can put you in touch with the i.t man from our paint supplier whose sole job is to travel around the country setting up job costing and invoicing at other shops and since we know some other paint manufacturers we could put you in touch with their i.t people as well.(2)we’ve always done it this way.Yea we used to write estimates by hand too.(3) I had a shop invoice me for an entire roll of tape paper to paint a fender.We are an honest shop our invoices are produced from a third party supplier(our paint manufacturer)based on the materials mixed under the RO for any given job.I could go on but suffice it to say they could not come up with a single legitamite reason not to pay the arguments they tried to make were both ridiculous and insulting to any reasonably intelligent business person. In the end they did pay but there are many others who simply refuse because they think they can get away with it.This is just one of many examples of the insurance industry abusing it’s power and it underscores the need for our industry to form stonger coalitions to help the honest shops out there win the battles for reform.

  35. Bruce on Wed, 18th Jan 2012 5:29 pm
  36. Ive been in the industry for going on 23 years, ive been running and working a small but well equipt, shop now for 8 years. I took the shop over from my employer who ran it for years. I see now what he was talking about- not making a reasonable profit. Its going mostley to materials and its got so hard if not impossible to beat an estimate, time wise. Im thinking most of the time why should i work so hard to do a top notch job when i could go get a job outside this field and most likely make more money and have a hell of lot less stress. But im still in there, something got to give with these ins co.’s there robbing us blind and you need a full time negotiater to deal with them. I totaly agree we need stronger coalitions, we need someone on our side fighting. n.c.

  37. Bob Isham on Thu, 19th Jan 2012 8:16 am
  38. Bruce–I think you share the sentiments of 95% of the collision shop owners in the country. Information Providers have, over the years, chiseled labor times. I would be pretty sure that they do this with insurer influence. State Farm operates a shop within it’s complex. Allstate has Tech-Cor which creates and invents repair methods. I understand State Farm gives the “information providers” results of time studies done at their shop. That radiator support that paid 9 hours is now 6.5 and it includes removing the radiator and a/c, lights, etc. etc. The quarter panel that has 13 hours and took the insurer 18 hours is not changed and the 13 hours stays put. Insurance Highway is a one way street.

    If you think the fix is in you are 100% correct. The only group that has shown sparkle in my nearly 25 years in this business has been the CCRE (Coalition for Collision Repair Excellence). They champion the rights of guys like you and teach you how to “work for the vehicle owner, not the insurer”. I would suggest you consider attending one the yearly seminars they run. You will meet people that have learned how to “work for the consumer” and break the relationship with the insurer. Real concepts that work. No pansies in the group but guys/gals who found out a long time ago what you have learned which is “the playing field has been tilted and needs to be leveled”.

  39. disgusted on Thu, 23rd Feb 2012 8:32 pm
  40. I think it’s an absolute disgrace that there are crooked body shop owners that hold there fingers down on the button while writing an estimate, than turn around and don’t replace the parts the insurance company has paid for. Who is really paying in the end? The policy holder, the insurance company never calls to say he mrs. so and so we have great news, your insurance premium has gone down. Does that ever happen? Hell no is doesn’t. The only call is hi mrs so and so, we dismantled your car and you have discovered additional damage, don’t worry were going to call your insurance company for a supplement and get them to cover every last screw we find. ” were going to fight it out and rob you and them blind. I’m not saying all body shops are stealing, what I am saying is 95% of them are. Greed is what it is. I hope the insurance commissioner catches every last one of the dishonest shops. Such a joke. I hope Karma catches up and one day these owners wrestles with the guilt and has to pay back every last dollar they stole to the policy holder. I see this everyday and cringe that I work for people like this.

  41. Bob Isham on Fri, 24th Feb 2012 8:19 am
  42. An open letter to “digusted”. You have made some very disparaging remarks about the collision industry. As a shop owner I take offense to all your comments.
    I would suspect you are employed by the insurance industry and would be shocked if you were just Mr. Joe Citizen.

    Yes we do have some bad apples but 95% of the work done by collision repair shops is completely ethical and clearly documented by the invoice they present.
    Those customers seeking to save deductibles and cut the repair process, together with the shops that allow this are the real crooks.

    It is more than 95% of the insurance industry that is crooked and not the shops.
    They write Chinese parts that they know are inferior and leave off critical elements of the repair process which can effect the safety and quality of the repair. This is done with malice. Why would a jury render a $65 million dollar judgement against MetLife if they did not suspect they were intentionally trying to defraud the consumer?

    Let me make it clear. More than 95% of the collision shops come to work each day wanting to fix cars correctly and get paid fairly. Most of them are able to do this and customer satisfaction rate is usually close to 98%. As for hidden damage try to look inside your engine compartment and examine parts behind the radiator or under the alternator. You would be lucky to get a tiny mouse to squeeze down in the nooks and crannies of the many hidden places in a vehicle.
    When something is hit we have a domino effect of the ac condenser hitting into the radiator, hitting the fan shroud, damaging the fan, bending the radiator support and other assorted items. Do you want the shop not tto replace all the nuts and screws? Don’t you understand the insurer is obligated to pay you for the repair and do this fairly?

    If our industry is so great why have more than 30% of the shops closed in the past several years? Most shops are just barely making it and a lot of others are on the verge of going out of business. Insurers only want cheap, don’t care about the quality or safety of the repair. If it was so lucrative why don’t insurance companies open shops? Allstate purchased some and they have closed several stores and not expanded. It is anticipated they are looking to unload them.

    If you want to find a good quality collision repair shop look for one that is independently owned, has been in business for 20 + years, has the right equipment, a good warranty, uses OEM parts and works for the consumer and not the insurer. Check with friends and neighbors, garage mechanics and people who have had collision repairs done.

    If any of what I said offends you I would be 99% sure you have in the past or currently work for an insurer.

  43. disgusted on Fri, 24th Feb 2012 3:31 pm
  44. @ Bob Isham I do not work for any insurance company. I work for an independently owed body shop that has been in business over 30 years. Maybe your shop is that 5% this shop however isn’t. They charge for OEM parts and put after market on or used. I see people charged for new bumpers that are repaired everyday. I cringe having to go to work for these criminals.

    Just a question……If your paid by insurance or a customer for a part that isn’t broken do you give the funds back to the customer or the insurance company?

  45. disgusted on Fri, 24th Feb 2012 3:33 pm
  46. @ Bob Isham

    I almost forgot, if they think there going to have an issue with the customer they convert the parts they didn’t use into labor hours deceiving the customer.

  47. Bob Isham on Fri, 24th Feb 2012 3:45 pm
  48. Disgusted

    Sorry you work for a crook. I would urge you to look for other employment. Don’t assume all shops are like your employers place of business. My guess is they also don’t charge deductibles and include the vehicle owner in the fraud.

    The very few times we have been paid for a part that was not damaged we have given the money back to the insurer. I can tell you that often the check in never cashed by the insurer because it is embarrasing to them. I have fired people who did not install a $20 part that we were paid for. We installed it after the firing because we want to complete the repair the way we bill it.

    Insurers have rarely ever put a part on an estimate that is not visibly damaged but rest assured when they do it is credited back to the insurer. Most often the credit is listed on the supp and it helps offset other parts they missed. I think you will find that 95% of the shops want to fix cars correctly and get paid fairly. We don’t want to cheat anyone. I wish I could say insurers don’t want to cheat shops or consumers.

    Some people may justify the stealing because insurers are stealing from them. This does not fly. Because an insurer steals we “call them out on it”, get paid fairly and break the insurers chops by holding them accountable.

    I would encourage you to find a shop that has strong ethics. You will happier and your customers will be treated fairly.

    My motto to customers is “I won’t steal for you and I won’t steal from you”.

  49. disgusted on Fri, 24th Feb 2012 5:43 pm
  50. I’ve been looking high and low trust me on that. Your shop is certainly an exception to the rule and I applaud you for your honesty. There are not many shops like yours the things I see are truly amazing. It’s shops like this that our insurance rates go through the roof, and it’s not right. It’s fraud, Tens of thousands of dollars I guess that is how they justify there multiple homes, rental properties, and commercial real estate not to mention the yachts and motor homes. The customer base is coming from all odd areas now, it’s not people in town as much as it use to be. I’m carious, what is the hourly rate you get from majority of insurance companies?

  51. Bob Isham on Sat, 25th Feb 2012 1:26 pm
  52. Our hourly rate is $48 body/refinish and between $28 and $30 for materials on paint hours. Mechanical is all over the map, we charge $100, some charge $75 and some $135.00.

    Don’t blame shops for the soaring cost of auto insurance. We want plastic and thin metal to lower gas mileage (a good thing) but the metal and plastic must be replaced more often than the old days. We have air bags which must be removed when replacing a quarter panel and all these things add to repair costs.
    We don’t control parts prices and surely not materials costs which are going up between 7%-8% each year.

    How many techs and shop employees get 6 weeks vacation, 15 sick days, and a hefty retirement funded by the shop, together will killer health insurance plans that include dental and drugs? Not many for sure BUT insurers have all this stuff and a lot of them get a vehicle to drive. Shops would love to give employees more but they can’t afford what insurers do. Don’t feel sorry for the insurance guys. Many estimators are finding that working for insurers is a lot more lucrative than shops.

    Finally a “general rule” is that if the shop has a vacation home, boat, ATV, maybe a Motor Home than he is probably a crook. Of course he could have a wife that is a high wage earner and live in a cheap house spending all his money on toys.

    This is a tough business for honest people but I do feel most of the people in our business are honest. Shop owners make a big investment in equipment and the physical plant. They take a risk and could lose it all. Insurers really take no risk and earn billions. They are well over a trillion dollar industry.

  53. disgusted on Sat, 25th Feb 2012 2:58 pm
  54. $48.00-$50.00 per hour and $24.00-$25.00 for paint and material. If it’s tri-stage they do a supplement. Mechanical is pretty much the same amount some ins co. will pay 65.00 ph. I do know that some of the insurance companies are cheap, but when your not even replacing the parts the owner thinks you are 1. that is insurance fraud to not only the customer but also the ins company. I see estimates for 3200.00 written and less than 600.00 done worth of work. If a customer comes in and needs the bumper painted on the right side, they are being charges 3.5 labor 2.0 to paint .5 for clear coating and the only thing being done is color blending, and taping off. How is that ok? So so wrong. I can’t even begin to tell you how many people call us back for the shotie work, that is not even checked over. The cannibalize 90% of what they touch, runs in paint etc. etc. There are adjusters being paid off for turning a blind eye and certain ones get envelopes at Christmas. How and why does this crap happen and go on?
    There customers are now out of towners mostly, benefits (medical only) are going bye bye.

  55. Ding on Mon, 9th Jul 2018 1:01 am
  56. really surprise for the real-life fraud by repairers. Gonna be careful for all the insurance related services.

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