The California Autobody Association (CAA) and Senator Jackie Speier
were successful in working with California Gov. Gray Davis to pass a key
piece of legislation, Senate Bill (SB) 1988.On Sept. 28 Davis signed it into law. The new legislation went into
effect on Jan. 1 and promises to improve business conditions for the
repair industry in California. Some of the bill's provisions-targeting
repair fraud, insurance fraud and vehicle theft-include the following:Requiring the Bureau of Automotive Repair (BAR) to implement a pilot
program to inspect insured vehicles to ensure the repairs match the
final invoice. The bill allocates $100,000 for the BAR to complete a
study by June 30, 2003. Vehicle owners can request that their
automobiles be included in the study, but they must have had repairs
completed within 120 days of the request. The repair bill must also
have been more than $2,500.Making it illegal for an insurer to require a shop to pay the cost
of an insured's rental vehicle or towing charges to be included in a
direct repair program (DRP). But the insurer and shop may agree in
writing to terms under which rental vehicle charges become the
responsibility of the shop when work is not completed in a certain
time frame.Allowing a shop that is denied participation in an insurer's DRP to
report the denial to the state's insurance department, which will
maintain a record of denials for gathering market conduct information.Requiring insurers that conduct labor rate surveys to report the
results to the insurance department, which will make it available to
the public upon request.Requiring insurance companies to provide each insured with an Auto
Body Repair Consumer Bill of Rights, advising consumers that they have
the right to pick their own shops.Requires insurers to inspect vehicles during or after repairs in an
effort to reduce fraudulent repair work and to produce statistics
about repair fraud.CAA Executive Director David McClune said Speier approached the CAA
last year to work on the bill, which includes provisions to fight
insurance fraud.Representatives from CAA testified at a hearing on Oct. 27, 1999 to
address consumer awareness and to "provide help to shops that were
being treated unfairly," he says. "Not everything we wanted was
there, but we were able to accomplish a lot on the main issues. We're very
thankful for Sen. Speier's efforts."CAA's legal counsel and legislative advocate Jack Molodanoff was also
involved with the development of the bill. "We're getting very
positive feedback," he says. "It's a big victory for the
autobody association. This should send waves down to the other 49
states."But it wasn't an easily won victory. "The insurance companies
wanted the status quo," he says. "It was a David and Goliath
battle. The war is not over. We're not stopping here. We will continue to
look after our members' interests."
