Connecticut Attorney General Richard A. Blumenthal today launched a nationwide call to all state attorneys general to join in urging the United States Attorney General to enforce federal antitrust laws that protect consumers against unlawful auto insurance company practices.
In response to a nationwide petition circulated by the Auto Body Association of Connecticut (ABAC), Blumenthal urged U.S. Attorney General Eric H. Holder Jr., to uphold federal consumer protection laws against “deceptive referrals” and other similar unlawful activities that violate consumer rights.
“Despite a four-decade old decree against these unlawful practices, insurance companies continue to coerce and manipulate consumers to repair their cars at facilities selected by insurance companies, taking away consumer freedom of choice,” says Bob Skrip, ABAC president. “We have presented Attorney General Blumenthal with petitions calling for enforcement of existing federal laws on this issue and we are grateful that today he is announcing his enthusiastic support.”
Blumenthal has long sought legislative and administrative remedies to the problem of auto insurers’ deceptive practices within Connecticut.
“This outpouring of complaints shows that problematic practices plague this industry, despite a 1963 consent decree and current law,” says Blumenthal. “Auto repairers and consumers are victims of the very same misconduct today: insurer control of appraisers, insurer financial incentives to consumers for their patronage of preferred auto facilities, and the establishment of set labor rates that repair facilities must use. The mantra of both federal and state law enforcers: your car, your choice.
“Practices pressuring consumers to use insurers’ preferred repair shops suppress consumer choice and disregard legal duties,” Blumenthal continues. “I have long sought legislative and administrative solutions to this untenable situation. We’re asking the federal government for an immediate review and remedy to stop coercive and deceptive tactics. Effective enforcement is critical.”
The ABAC petition, circulated to sister organizations nationwide, was signed by 48 of the 50 states. Two states do not have auto body associations or repair shops leading the industry in their areas. The petition called on Holder to enforce federal antitrust laws and protect consumers from auto insurance company anticompetitive practices.
“In 1963, then-Attorney General Robert F. Kennedy issued a federal decree to prevent what was rampant, nationwide trampling on consumer rights by automobile insurance companies,” says Skrip. “Today, the collision repair industry is plagued with the same problems it suffered in 1963 at the hands of insurers. Millions of consumers have fallen prey to the deceptive practices of insurance companies, and the laws to protect these consumers are not being enacted.”
“Almost 50 years later, insurer steering is still a scourge,” Blumenthal says.
Connecticut is leading the charge against the insurance companies’ deceptive practices. “Thanks to consumer protections recently enacted in our state and to our attorney general’s vocal support, Connecticut drivers are beginning to understand, ‘It’s your car, your choice where to have it repaired.’ Consumers should not be coerced into using an insurance company’s preferred shop, which will often use aftermarket replacement parts or even used parts that may void a new car warranty,” Skrip says.
ABAC is a statewide consumer advocacy group dedicated to the advancement of the collision repair industry and upholding consumer rights. For more information, visit www.abaconn.com.
