Oregon anti-steering bill passes

An anti-steering bill has passed the Oregon legislature, and will become law later this summer. Senate Bill 523-A, originally introduced in February by state Senator Floyd Prozanski, passed the Oregon House 55 to zero, with one member absent and four excused during an evening session.

"Independent auto body shops in Oregon showed everyone that we are capable of articulating consumer problems in the industry, proposing solutions and most importantly, building support for those solutions in and out of the legislature," said Jim Marr, lead lobbyist for Oregonians for Safe Auto Repair (OSAR).

The bill passed the Oregon Senate in May.

Prozanski, a Democrat based in Eugene, heads the Senate Commerce Committee and introduced the bill at the request of OSAR, a group of independent auto collision repair shops.

Marr says he was surprised at the unanimous vote, considering the slim majority the Democrats (who generally supported the bill) have in the Oregon House. "This time of the year, many bills have some partisan element to them," Marr said. "Autobody collision shop owners that worked on the bill really made an effort to inform Republican members of the House about the merits of the bill."

As originally written, the bill would have prohibited insurers from suggesting or recommending a collision repair shop unless the customer requested the referral, and would require insurance companies to inform customers of their right to choose a shop.

After a March 5 hearing and an April 30 work session, the bill was amended, removing the prohibition on providing unsolicited referrals. Under the new language, the bill would require the insurance company representative to inform the insured of their right to choose a repair shop before providing a recommendation. Current Oregon law prohibits insurance companies from requiring consumers to have their repairs done at a specific shop.

If the customer wants the repairs done at a different shop, the "insurer may not limit the cost of repairs necessary to return the motor vehicle to a pre-loss condition relative to safety, function and appearance other than as stated in the policy or as otherwise allowed by law," according to the bill.

If the customer accepts the recommendation, the insurer must provide notice electronically or in print that the "vehicle will receive repairs returning it to a pre-loss condition relative to safety, function and appearance at no additional cost to you other than as stated in the insurance policy or as otherwise allowed by law."

"We put the insurance industry in the untenable position of looking like they would be opposed to consumer protection," Marr said. "We know that whenever a victory like this is achieved, it gives other states hope, and gives collision shop owners confidence that reforms can be made."

The bill was supported by the Oregon Trial Lawyers Association, Oregon's Department of Justice, and the Northwest Auto Trades Association (NATA).

Once the governor signs the bill into law, it could go into effect as early as July.