The Farmers article is misleading and inflamatory. The majority of consumers will not fall prey to replacing a windshield that is not broken. If they do the penalty is severe. In my opinion the “fraud” occurs when the consumer is bilked into replacing the windshield and then authorizes a direct bill to their insurance company without ever asking about the cost. The offers of free dinners and deductible waiver are tempting fruit to the unwary so why worry, right? I don’t have to pay anything and we get free food, how nice. If the consumer paid for the glass replacement out of pocket it would be a competitive price and a different scenario with no free dinners. The unreputable glass companies will typically bill the insurance company three times the “reasonable rate” knowing their profit will come from the inflated insurance payment. It’s no wonder the insurance companies are fed up with these types of scams. If we see a glass bill that is out of line we will pay only the fair and reasonable rate for the area. When the glass company receives a lesser payment the customer is the one that pays the balance of the bill. The insurance company is not ” the customer” so the insured ends up going to court and paying the inflated balance. The policy of insurance is a contract which requires insureds to notify the insurer as soon as possible after a loss. If the insured falls for the free dinner caper and never questions the bill then the insured may as well get ready for small claims court. And we wonder why our insurance rates continue to rise.
In response to Dan…I am not ignoring your question. I did not see it until this morning. I have several previously scheduled conference calls today that require my immediate attention. I will respond to you before the end of the day. I hope that is satisfactory…Leo
Bill, I have read your post, and due to your words “If we see a glass bill that is out of line we will pay only the fair and reasonable rate for the area”, I must assume you work for an insurer.
I therefore have a few questions:
1. If you only pay a ‘fair and reasonable price’ when you see a glass bill that is out of line, WHY does that cause insurance rates to rise, if you didn’t actually PAY the higher bill???
2. If you see an insured being taken advantage of, and taken to small claims court for payment of a bill, do you have a duty to defend them under the policy, because you didn’t fully pay the bill?
3. What measure of quality do you take into account when you determine your ‘fair and reasonable’ payment rates, such as quality of glass, quality of materials, quality of installers, and level of services being offered for the insurers definition of ‘fair and reasonable’? If you are settling claims in public, for the public, with public market data or analysis, do you provide that formula to your insureds when you ‘settle’ their claim to your determination of ‘fair and reasonable’ rates?
4. If you as insurers know that these unscrupulous practices are going on by these glass companies, and, as you say, it is causing insurance rates to rise, why haven’t you gone after them? As a consumer, I would love to see insurers prosecute those submitting inflated bills, waiving deductibles, offering kickbacks to agents, and more.
5. Is it possible you should be careful when accusing these shops that offer dinners, steaks, and other items, to see if it is indeed the glass shop paying for these items, rather than, as found in Denver, where it was the restaurant actually paying for the year’s free meals in the hope of building thier clientel? How do you know the insurer is paying extra through the glass bill at all? Is it possible that glass installers do this to stop insurer steering?
6. Are you painting the glass industry with an incredibly broad brush, using accusations of fraud loosely? What did Farmers have to pay back to the policy holders in Texas recently for overcharging on homeowners premiums? And how much is Allstate going to pay back to Texas policyholders as of a couple of days ago…about $6 mil plus, wasn’t it?
You see, that broad brush paints both sides of the fence.
I am not an attorney so I will not try to respond as if I am. Having left the NGA in 1990 and only returning last September, I needed to do some homework on the question you raised.
The NGA’s Office of General Counsel conducted a thorough search of federal law and found nothing that specifically refers to “steering” as illegal. Several lawsuits, notably in Texas and New York, have alleged that “steering” violated federal racketeering statutes. Both suits failed. At least one other lawsuit is still pending.
I also asked our legislative researcher to review state law so we might respond to your question. You asked…”where law also allows insurance companies to require their insureds to call my direct competitor for the purpose of filing their claims.”
We found no evidence that any state has ever “allowed an insurance company to require their insureds to call” a specific or particular auto glass service provider. To the contrary, Arizona and Michigan passed new laws this year specifically prohibiting insurance companies from telling their customers where they can get their vehicles repaired. The Arizona and Michigan laws specifically reference auto glass as do earlier laws passed in Colorado, Connecticut, Delaware, Illinois, Kansas, Kentucky. Louisiana, Maine, Minnesota, Mississippi, Montana, Nebraska, Vermont, West Virginia and Wisconsin.
Sixteen other states have enacted consumer protection laws to safeguard the consumer’s right to “free choice” in selecting their automotive service provider. In these states, we find no specific reference to auto glass but rather to automotive service in general.
That is a total of 33 states with laws on the books to protect consumer “freedom of choice” in automotive service. The NGA has consistently supported “free choice” to protect consumer rights and will continue to do so. That is the NGA’s position.
Where the entire industry, including the NGA, appears to have fallen short is in educating the consumer that they have a right to free choice and, more importantly, why they should insist on exercising that right. The NGA has formed the Coalition for Auto Glass Safety & Public Awareness (CASPA) to address that deficiency. In fact, CASPA’s first national press release addressing this subject was issued this week. Other releases will follow on a regular basis.
Promoting “free choice” will be a priority item for discussion at the NGA’s Auto Glass Conference & Expo next month in Tampa. Our NGA Auto Glass Division will solicit ideas from its members as well as propose initiatives that are in addition to the national press releases.
In summary, I don’t think the issue is NGA’s position. As I said above, I have gone back through the archives and found the NGA consistently supported “free choice”. The problem is that too few consumers are aware of their “rights” or why it is in their best interest to insist their “free choice” be respected. Because they are unaware or don’t care, they say nothing. That silence leads state government to conclude there is no problem.
The NGA should bear its share of the blame. We all should. Using the wisdom of hindsight, we should have begun the auto glass education of the American consumer 25 years ago. Had we done so… the hue and cry to pressure government for reform and / or to enforce existing law would be deafening.
At the moment there is only silence. We will do everything we can to provide the consumer with the information they need to decide for themselves and we will do so as fast as possible.
In an earlier posting, I assumed “steering” was universally illegal. I suspect I am not the only person in our industry to have made this assumption. I apologize if I misled anyone and I thank you for suggesting I check the facts.
Mark, yes, I am the VP of Claims for a medium size insurer writing personal lines property and casualty business in ninteen states. I appreciate your candor and the candid questions raised in your posting.
Glass replacement pricing has always been a “hot topic” among our producers. A recent meeting in Wisconsin yielded some rather startling but old information. It boils down to this Mark. If the consumer replaces their windshield without filing an insurance claim, the cost is usually ” fair and reasonable” as the consumer is shopping for the best deal on a piece of OEM glass and will go with the most competitive cost because it is “out of pocket”. On the other hand, if the consumer files the insurance claim and the glass company sends the bill direct to the insurer it’s usually double or triple the cost. You may ask why does this happen. Because the glass company hopes the insurer will “fast track” the claim and simply pay it.
I personally tested this assumption and called a national glass network to replace a windshield in my 1994 Chevrolet pick-up. I was quoted a price of $394.00 for OEM glass to include the installation and urethane kit if I paid at the time of installation. Then I proceed to take my vehicle to the network shop and filed a comprehensive claim with my insurer. I was amazed as the glass company submitted a bill to my insurer for $ 904.32 based on the Mitchell NAGS price without a percentage discount. As expected, my insurer paid the company without questioning the bill. When a single insurer is replacing 33,000 windshields a year it’s not worth the expense dollar to examine each and every glass bill for accuracy. The bottom line is “consumer beware”. If you’re accepting free dinners and deductible waivers to save your dollars then expect your rates to rise accordingly. So who’s fault is it? The insurers for not taking a more agressive stance and questioning each bill or the glass company for charging an inflated price to begin with? Perhaps the insurer should call for the glass price and send a check with the insured so the installation is paid for up front at a preferred shop? Would that be steering? You bet! Is it illegal? No. It is my hope the industry reaches a level of standarization that accounts for fair pricing across the board. Then we all win! The customer has a choice and the cost is consistent.
We have no recourse against glass companies that charge inflated pricing as the offer of free dinners and deductible waivers are made equally to all. The customer is the one that suffers when we short pay the bill. And if it goes to small claims we have no duty to defend. The customer pays the difference as the “insurer” is not the customer. So when the consumer is enjoying the free dinners, keep in mind, nothing is free. We all pay for that dinner!
The job that daily and catastrophe adjusters have to do is a uniquely complex one. The ability for the high quality adjuster to maintain their focus, which is to help insured ones while following (sound) carrier instructions, and make a living, is a commendable and challenging calling to follow, and I hope that all of the good people that are in the adjusting field remain commited to that calling and all that it entails. I do not share the same sentiments for others that follow carrier instructions so as to be able maintain their own standard of living, to the detriment of their neighbors reputations and welfare.
I suggest that CEO’s are quite aware of what it takes, from the trenches on up, to cover their company’s operating costs and satisfy stockholders who have gotten use to certain returns on their investments. Hard markets call for hard CEO type decisions, and the glossing over of those decisions.
If you will, carefully follow the nine page Allstate letter to completion, especially keeping in mind the blue lead information at the top of pages 1-8 (and especially page 5)…then reflect on the following neighborly and commendable admonition from khromas to Todd Brooks on CADO 12/18/2003;
(The khromas reply was addressing Brooks receiving his new adjusting license, and Brooks considering employment with Allstate).
Brooks,
“I would not advise calling Allstate if you wish to keep your integrity intact.
After almost 7 years with them and having held a variety of positions, including the sole Quality Evaluator for the entire southern half of Texas, I finally became fed up with their approach to requiring every adjuster to knowingly underpay every claim and left them this past July.
The head of Allstate in Texas – Gary Briggs – had the nerve to stand up in front of an agent’s meeting last spring and say (QUOTE) “I love the new HOA+ policy! It doesn’t cover anything and WE STILL GET TO KEEP THEIR MONEY”!
I used to tell people whose claim I was handling that “the good hands of Allstate were right here” as I held out my hands for them. I could no longer do that in good faith and look myself in the mirror so I left.
One of these days the Texas DOI is going to catch up with their property handling practices and then it will all hit the fan! Good luck with anyone else!”
Kevin Hromas
Gale, the reasons behind Gary Briggs exclamation and part of Allstates profitability margins may very well be connected and may support “why” (so-to-speak) Mr. Poe submitted 5 Allstate claims in 2003 to the TDI and why they are now in the TDI’s legal department. It will also be interesting to see how Allstate (and other carriers) conducted themselves while settling Hurricane Isabel and California fire claims.
At least Kevin, unlike some other Allstate adjusters-associates, had the level of personal integrity needed to not want to harm consumers-people for profit…and so made his livelyhood elsewhere.
< Message edited by Leam Kincaid -- 6/22/2004 9:06:42 AM >
It is our beleif that the real issue in regarding the glass industry and any other repair industry has nothing to do with saving the consumer money. The real issue for consumers is who will get the lions share of their money.
When we look at what is “fair and reasonable” it does not translate. The insurance industry has reported large profits during an economic slow down. CEO’s and Corporate board members have earn large sums of money. These wages a justified by corporate talking heads as “fair and reasonable” because these indiviuals are credited with saving money for their companies and turning profit for the investors.
Every independent glass shop is working hard everyday to provide their customers with the best quality of service, materials, and workmanship in the hopes that they too will be able to turn a profit, build a customer base of repeat customers and earn a living.
This becomes such a huge task because now they must compete not only with other glass shops but, also with TPA’s who are representing corporate glass gaints who are misleading, scaring, steering and in some cases even delaying payment of claims the insured. This constitute a huge disadvantage for small and midsize glass shops. This too is dishonest and immorale. So, if we are all honest about what is happening. Let’s give the public the whole truth and not just parts of the truth.
P.S. Remeber, there are more of us honest and hard working shops then it is of them!
Bill, you said, “I personally tested this assumption and called a national glass network to replace a windshield in my 1994 Chevrolet pick-up. I was quoted a price of $394.00 for OEM glass to include the installation and urethane kit if I paid at the time of installation. Then I proceed to take my vehicle to the network shop and filed a comprehensive claim with my insurer. I was amazed as the glass company submitted a bill to my insurer for $ 904.32 based on the Mitchell NAGS price without a percentage discount. As expected, my insurer paid the company without questioning the bill. When a single insurer is replacing 33,000 windshields a year it’s not worth the expense dollar to examine each and every glass bill for accuracy. The bottom line is “consumer beware”.”
You are the VP of claims of a medium sized insurer? By your own words, 33,000 claims per year. Worst case senario is that number of claims multiplied by your difference in price of $510.32. I checked twice to make sure my calculator wasn’t fooling me. That would be a total of $16,840,560.00 per year. 16.8 million. Geez man, I’ll audit every claim your company encounters for just 10% of what I save you each year. Hell, I don’t even need vacation or benefits. How about it Bill, do I get the job?
You are right about one thing. It is definitely consumer beware. Consumer beware of insurance companies who are crying how much money they are losing to fraud, are too lazy to keep the fraud in check and still report record profits each year with exec’s and ceo’s taking home obscene amounts of salary and bonuses. So where does all that profit come from to pay salaries, bonuses and the fraud losses? My thinking is that the consumer is paying too much for their coverages, and then the honest glass and auto body folks are being cheated out of what should be honest profits for their parts and services.
Why is it that everyone puts down the free offer as something you pay for,illegal,unfair, etc. This is completely innaccurate. A marketing co-op is an advantages agreemant for two parties to share advertising dollars. Free dinners,carwashes, or widgets are offered by the company in the ad to the glass consumer as an incentive with no added cost. The Glass shop, Transmission outfit, or Oil change business that is going to spend advertising dollars anyway finds a way to offset cost or value-add to thier consumer. This is much the same as Geico saving 15% by sitting a gecko in the seat an agent used to occupy. Or the toy in the cereal. There is nothing unfair about it except it makes those without the resources to fight it upset. What better way to get around network steering than a direct to consumer advertising blitz that states come to me and I will offer safety AGRRS cert NGA cert and yes I will charge more than cash to offset my costs.
This brings me to a new focus. Cash. The cash segment is a much smaller segment of business. When I give a deeper discount to a smaller segment of my business (cash) because I do not have to sit on hold and wait for dispatches and reference numbers listening to a safelite rep try to steal my business it is my business not the insurance company’s. If you do not have time to check every invoice then hire more people do not expect me to pay for it. An insurance company gets charged more than cash because they make us spend more time dealing on the phone and less time installing glass.
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The Farmers article is misleading and inflamatory. The majority of consumers will not fall prey to replacing a windshield that is not broken. If they do the penalty is severe. In my opinion the “fraud” occurs when the consumer is bilked into replacing the windshield and then authorizes a direct bill to their insurance company without ever asking about the cost. The offers of free dinners and deductible waiver are tempting fruit to the unwary so why worry, right? I don’t have to pay anything and we get free food, how nice. If the consumer paid for the glass replacement out of pocket it would be a competitive price and a different scenario with no free dinners. The unreputable glass companies will typically bill the insurance company three times the “reasonable rate” knowing their profit will come from the inflated insurance payment. It’s no wonder the insurance companies are fed up with these types of scams. If we see a glass bill that is out of line we will pay only the fair and reasonable rate for the area. When the glass company receives a lesser payment the customer is the one that pays the balance of the bill. The insurance company is not ” the customer” so the insured ends up going to court and paying the inflated balance. The policy of insurance is a contract which requires insureds to notify the insurer as soon as possible after a loss. If the insured falls for the free dinner caper and never questions the bill then the insured may as well get ready for small claims court. And we wonder why our insurance rates continue to rise.
Is it just me, or did the NGA adopt a defensive posture in response to my inquiry to their opinion on steering?
In response to Dan…I am not ignoring your question. I did not see it until this morning. I have several previously scheduled conference calls today that require my immediate attention. I will respond to you before the end of the day. I hope that is satisfactory…Leo
Bill, I have read your post, and due to your words “If we see a glass bill that is out of line we will pay only the fair and reasonable rate for the area”, I must assume you work for an insurer.
I therefore have a few questions:
1. If you only pay a ‘fair and reasonable price’ when you see a glass bill that is out of line, WHY does that cause insurance rates to rise, if you didn’t actually PAY the higher bill???
2. If you see an insured being taken advantage of, and taken to small claims court for payment of a bill, do you have a duty to defend them under the policy, because you didn’t fully pay the bill?
3. What measure of quality do you take into account when you determine your ‘fair and reasonable’ payment rates, such as quality of glass, quality of materials, quality of installers, and level of services being offered for the insurers definition of ‘fair and reasonable’? If you are settling claims in public, for the public, with public market data or analysis, do you provide that formula to your insureds when you ‘settle’ their claim to your determination of ‘fair and reasonable’ rates?
4. If you as insurers know that these unscrupulous practices are going on by these glass companies, and, as you say, it is causing insurance rates to rise, why haven’t you gone after them? As a consumer, I would love to see insurers prosecute those submitting inflated bills, waiving deductibles, offering kickbacks to agents, and more.
5. Is it possible you should be careful when accusing these shops that offer dinners, steaks, and other items, to see if it is indeed the glass shop paying for these items, rather than, as found in Denver, where it was the restaurant actually paying for the year’s free meals in the hope of building thier clientel? How do you know the insurer is paying extra through the glass bill at all? Is it possible that glass installers do this to stop insurer steering?
6. Are you painting the glass industry with an incredibly broad brush, using accusations of fraud loosely? What did Farmers have to pay back to the policy holders in Texas recently for overcharging on homeowners premiums? And how much is Allstate going to pay back to Texas policyholders as of a couple of days ago…about $6 mil plus, wasn’t it?
You see, that broad brush paints both sides of the fence.
Dan…Here is the response I promised earler today.
I am not an attorney so I will not try to respond as if I am. Having left the NGA in 1990 and only returning last September, I needed to do some homework on the question you raised.
The NGA’s Office of General Counsel conducted a thorough search of federal law and found nothing that specifically refers to “steering” as illegal. Several lawsuits, notably in Texas and New York, have alleged that “steering” violated federal racketeering statutes. Both suits failed. At least one other lawsuit is still pending.
I also asked our legislative researcher to review state law so we might respond to your question. You asked…”where law also allows insurance companies to require their insureds to call my direct competitor for the purpose of filing their claims.”
We found no evidence that any state has ever “allowed an insurance company to require their insureds to call” a specific or particular auto glass service provider. To the contrary, Arizona and Michigan passed new laws this year specifically prohibiting insurance companies from telling their customers where they can get their vehicles repaired. The Arizona and Michigan laws specifically reference auto glass as do earlier laws passed in Colorado, Connecticut, Delaware, Illinois, Kansas, Kentucky. Louisiana, Maine, Minnesota, Mississippi, Montana, Nebraska, Vermont, West Virginia and Wisconsin.
Sixteen other states have enacted consumer protection laws to safeguard the consumer’s right to “free choice” in selecting their automotive service provider. In these states, we find no specific reference to auto glass but rather to automotive service in general.
That is a total of 33 states with laws on the books to protect consumer “freedom of choice” in automotive service. The NGA has consistently supported “free choice” to protect consumer rights and will continue to do so. That is the NGA’s position.
Where the entire industry, including the NGA, appears to have fallen short is in educating the consumer that they have a right to free choice and, more importantly, why they should insist on exercising that right. The NGA has formed the Coalition for Auto Glass Safety & Public Awareness (CASPA) to address that deficiency. In fact, CASPA’s first national press release addressing this subject was issued this week. Other releases will follow on a regular basis.
Promoting “free choice” will be a priority item for discussion at the NGA’s Auto Glass Conference & Expo next month in Tampa. Our NGA Auto Glass Division will solicit ideas from its members as well as propose initiatives that are in addition to the national press releases.
In summary, I don’t think the issue is NGA’s position. As I said above, I have gone back through the archives and found the NGA consistently supported “free choice”. The problem is that too few consumers are aware of their “rights” or why it is in their best interest to insist their “free choice” be respected. Because they are unaware or don’t care, they say nothing. That silence leads state government to conclude there is no problem.
The NGA should bear its share of the blame. We all should. Using the wisdom of hindsight, we should have begun the auto glass education of the American consumer 25 years ago. Had we done so… the hue and cry to pressure government for reform and / or to enforce existing law would be deafening.
At the moment there is only silence. We will do everything we can to provide the consumer with the information they need to decide for themselves and we will do so as fast as possible.
In an earlier posting, I assumed “steering” was universally illegal. I suspect I am not the only person in our industry to have made this assumption. I apologize if I misled anyone and I thank you for suggesting I check the facts.
Mark, yes, I am the VP of Claims for a medium size insurer writing personal lines property and casualty business in ninteen states. I appreciate your candor and the candid questions raised in your posting.
Glass replacement pricing has always been a “hot topic” among our producers. A recent meeting in Wisconsin yielded some rather startling but old information. It boils down to this Mark. If the consumer replaces their windshield without filing an insurance claim, the cost is usually ” fair and reasonable” as the consumer is shopping for the best deal on a piece of OEM glass and will go with the most competitive cost because it is “out of pocket”. On the other hand, if the consumer files the insurance claim and the glass company sends the bill direct to the insurer it’s usually double or triple the cost. You may ask why does this happen. Because the glass company hopes the insurer will “fast track” the claim and simply pay it.
I personally tested this assumption and called a national glass network to replace a windshield in my 1994 Chevrolet pick-up. I was quoted a price of $394.00 for OEM glass to include the installation and urethane kit if I paid at the time of installation. Then I proceed to take my vehicle to the network shop and filed a comprehensive claim with my insurer. I was amazed as the glass company submitted a bill to my insurer for $ 904.32 based on the Mitchell NAGS price without a percentage discount. As expected, my insurer paid the company without questioning the bill. When a single insurer is replacing 33,000 windshields a year it’s not worth the expense dollar to examine each and every glass bill for accuracy. The bottom line is “consumer beware”. If you’re accepting free dinners and deductible waivers to save your dollars then expect your rates to rise accordingly. So who’s fault is it? The insurers for not taking a more agressive stance and questioning each bill or the glass company for charging an inflated price to begin with? Perhaps the insurer should call for the glass price and send a check with the insured so the installation is paid for up front at a preferred shop? Would that be steering? You bet! Is it illegal? No. It is my hope the industry reaches a level of standarization that accounts for fair pricing across the board. Then we all win! The customer has a choice and the cost is consistent.
We have no recourse against glass companies that charge inflated pricing as the offer of free dinners and deductible waivers are made equally to all. The customer is the one that suffers when we short pay the bill. And if it goes to small claims we have no duty to defend. The customer pays the difference as the “insurer” is not the customer. So when the consumer is enjoying the free dinners, keep in mind, nothing is free. We all pay for that dinner!
The job that daily and catastrophe adjusters have to do is a uniquely complex one. The ability for the high quality adjuster to maintain their focus, which is to help insured ones while following (sound) carrier instructions, and make a living, is a commendable and challenging calling to follow, and I hope that all of the good people that are in the adjusting field remain commited to that calling and all that it entails. I do not share the same sentiments for others that follow carrier instructions so as to be able maintain their own standard of living, to the detriment of their neighbors reputations and welfare.
I suggest that CEO’s are quite aware of what it takes, from the trenches on up, to cover their company’s operating costs and satisfy stockholders who have gotten use to certain returns on their investments. Hard markets call for hard CEO type decisions, and the glossing over of those decisions.
http://www.allstate.com/investor/annual_report/2002/chair_letter.asp
If you will, carefully follow the nine page Allstate letter to completion, especially keeping in mind the blue lead information at the top of pages 1-8 (and especially page 5)…then reflect on the following neighborly and commendable admonition from khromas to Todd Brooks on CADO 12/18/2003;
(The khromas reply was addressing Brooks receiving his new adjusting license, and Brooks considering employment with Allstate).
Brooks,
“I would not advise calling Allstate if you wish to keep your integrity intact.
After almost 7 years with them and having held a variety of positions, including the sole Quality Evaluator for the entire southern half of Texas, I finally became fed up with their approach to requiring every adjuster to knowingly underpay every claim and left them this past July.
The head of Allstate in Texas – Gary Briggs – had the nerve to stand up in front of an agent’s meeting last spring and say (QUOTE) “I love the new HOA+ policy! It doesn’t cover anything and WE STILL GET TO KEEP THEIR MONEY”!
I used to tell people whose claim I was handling that “the good hands of Allstate were right here” as I held out my hands for them. I could no longer do that in good faith and look myself in the mirror so I left.
One of these days the Texas DOI is going to catch up with their property handling practices and then it will all hit the fan! Good luck with anyone else!”
Kevin Hromas
Gale, the reasons behind Gary Briggs exclamation and part of Allstates profitability margins may very well be connected and may support “why” (so-to-speak) Mr. Poe submitted 5 Allstate claims in 2003 to the TDI and why they are now in the TDI’s legal department. It will also be interesting to see how Allstate (and other carriers) conducted themselves while settling Hurricane Isabel and California fire claims.
At least Kevin, unlike some other Allstate adjusters-associates, had the level of personal integrity needed to not want to harm consumers-people for profit…and so made his livelyhood elsewhere.
< Message edited by Leam Kincaid -- 6/22/2004 9:06:42 AM >
It is our beleif that the real issue in regarding the glass industry and any other repair industry has nothing to do with saving the consumer money. The real issue for consumers is who will get the lions share of their money.
When we look at what is “fair and reasonable” it does not translate. The insurance industry has reported large profits during an economic slow down. CEO’s and Corporate board members have earn large sums of money. These wages a justified by corporate talking heads as “fair and reasonable” because these indiviuals are credited with saving money for their companies and turning profit for the investors.
Every independent glass shop is working hard everyday to provide their customers with the best quality of service, materials, and workmanship in the hopes that they too will be able to turn a profit, build a customer base of repeat customers and earn a living.
This becomes such a huge task because now they must compete not only with other glass shops but, also with TPA’s who are representing corporate glass gaints who are misleading, scaring, steering and in some cases even delaying payment of claims the insured. This constitute a huge disadvantage for small and midsize glass shops. This too is dishonest and immorale. So, if we are all honest about what is happening. Let’s give the public the whole truth and not just parts of the truth.
P.S. Remeber, there are more of us honest and hard working shops then it is of them!
Bill, you said, “I personally tested this assumption and called a national glass network to replace a windshield in my 1994 Chevrolet pick-up. I was quoted a price of $394.00 for OEM glass to include the installation and urethane kit if I paid at the time of installation. Then I proceed to take my vehicle to the network shop and filed a comprehensive claim with my insurer. I was amazed as the glass company submitted a bill to my insurer for $ 904.32 based on the Mitchell NAGS price without a percentage discount. As expected, my insurer paid the company without questioning the bill. When a single insurer is replacing 33,000 windshields a year it’s not worth the expense dollar to examine each and every glass bill for accuracy. The bottom line is “consumer beware”.”
You are the VP of claims of a medium sized insurer? By your own words, 33,000 claims per year. Worst case senario is that number of claims multiplied by your difference in price of $510.32. I checked twice to make sure my calculator wasn’t fooling me. That would be a total of $16,840,560.00 per year. 16.8 million. Geez man, I’ll audit every claim your company encounters for just 10% of what I save you each year. Hell, I don’t even need vacation or benefits. How about it Bill, do I get the job?
You are right about one thing. It is definitely consumer beware. Consumer beware of insurance companies who are crying how much money they are losing to fraud, are too lazy to keep the fraud in check and still report record profits each year with exec’s and ceo’s taking home obscene amounts of salary and bonuses. So where does all that profit come from to pay salaries, bonuses and the fraud losses? My thinking is that the consumer is paying too much for their coverages, and then the honest glass and auto body folks are being cheated out of what should be honest profits for their parts and services.
Why is it that everyone puts down the free offer as something you pay for,illegal,unfair, etc. This is completely innaccurate. A marketing co-op is an advantages agreemant for two parties to share advertising dollars. Free dinners,carwashes, or widgets are offered by the company in the ad to the glass consumer as an incentive with no added cost. The Glass shop, Transmission outfit, or Oil change business that is going to spend advertising dollars anyway finds a way to offset cost or value-add to thier consumer. This is much the same as Geico saving 15% by sitting a gecko in the seat an agent used to occupy. Or the toy in the cereal. There is nothing unfair about it except it makes those without the resources to fight it upset. What better way to get around network steering than a direct to consumer advertising blitz that states come to me and I will offer safety AGRRS cert NGA cert and yes I will charge more than cash to offset my costs.
This brings me to a new focus. Cash. The cash segment is a much smaller segment of business. When I give a deeper discount to a smaller segment of my business (cash) because I do not have to sit on hold and wait for dispatches and reference numbers listening to a safelite rep try to steal my business it is my business not the insurance company’s. If you do not have time to check every invoice then hire more people do not expect me to pay for it. An insurance company gets charged more than cash because they make us spend more time dealing on the phone and less time installing glass.