The good faith angst between insurance companies and the shops they DON’T own…
Independent body shop owners are in a constant “David and Goliath” struggle with insurance companies that believe that they can underpay for repairs, regardless of the effect that it has upon our mutual customer. Professional estimators at local independent body shops all across America write good faith estimates based upon the damage that is presented, and what they believe it will cost to repair. Insurance adjusters write their own estimates, and almost without exception, those estimates tend to come in lower than those the shop estimators provide.
We say almost without exception because some body shops have “agreements” with the insurance companies that prohibit them from disputing the insurance estimates. Those shops are not the focus of this article. Rather, we would like to draw attention to an increasingly contentious battle between the insurance companies and the independent body shops not beholding to them.
There is a new insurance company tactic on the rise: severely under-estimating a repair order. This presents itself when an insurance adjuster’s original estimate comes in 50% – 75% lower than the shop’s estimate based upon the very same visual inspection. This “bad-faith” trend is apparently designed to bully smaller shop owners to cave-in to less than the amount of performing a proper repair. And the bad news is… it works. Many shop owners don’t want the fight that always accompanies such low ball estimates. Rather than standing their ground and holding off on a repair until insurance steps up and pays for the correct repair, they lock-in the estimates and effectively pass the costs directly to the customer.
Here at Nylund’s Collision Center, we are crying “FOUL!” on this entire process! We encourage all independent body shop owners to unite against ridiculous bad-faith insurance estimates. The consumer is the ultimate loser when compromise in the quality of repair just to boost insurance profit margins becomes the driving factor. Insurance companies are tasked to pay to repair a vehicle to pre-loss condition. Their delay and deny tactics are absolutely designed to outlast our resolve… but we’ve read the story of David and Goliath, and we know how it ends! Let’s head to the river and load our bags with smooth stones! It’s not what we want to to do… it’s what we MUST DO.
They have strong tactics… but we must have stronger resolve to serve our guests with integrity. Remember – your independent body shop is YOUR SANDBOX! Your contract is with your guest – not the insurance company. You are obligated to provide a good faith estimate to repair their vehicle, and the insurance company is required to at least write estimates in good faith. They must come to realize that we – shop owners – are the repair experts. They just fund the repair.
We do not expect a 100% match from the insurance companies. But neither do we expect (or accept) such a divergent, and frankly insulting low-balling attempt to bully us into submission. We believe that the insurance companies have a duty… an obligation – moral or legal – to the vehicle owner they are writing estimates for.
So… stand your ground on behalf of your guest! You CAN win the battle! We do it every day. Because it matters.