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OEM repair procedure laws need a narrow focus

Tuesday, July 2, 2019 - 07:00
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Earlier this year I wrote a column suggesting the industry should “be careful what you wish for” in terms of the automaker shop certification programs.

That same admonition, about being careful what you wish for, has been coming to mind a lot as I watch various efforts in states around the country to enact legislation related to OEM repair procedures.

Some of these legislative proposals look great to me. As I write this, I don’t know how far it will make it through the legislative process, but a relatively simple proposal in New Hampshire would require insurers to pay all claims based on repairers’ use of OEM repair procedures.

Bills in other states, however, are getting bogged down by opposition because they try to take on other issues, like placing new restrictions on non-OEM parts. That’s a separate issue. It’s hard for someone to argue against the need for insurers to pay for safe repairs that follow OEM procedures, but there are plenty of players in the industry who can and will argue for consumer choice of parts. Don’t invite their opposition by trying to take on that issue – or steering or any of the other host of industry issues – in a bill about getting paid for use of OEM repair procedures.

But aside from that, here’s where the “be careful what you wish for” warning comes in: The bills I’ve seen in some states related to OEM procedures don’t just mandate that insurers pay for those procedures when they are followed. The bills actually require that shops follow those OEM procedures.

I was speaking at an industry gathering earlier this year where a lobbyist was suggesting just such legislation. And at a survey at a Collision Industry Conference (CIC) this spring, while 32% of attendees said legislation is needed to prevent insurers from using payment practices to push for repairs that vary from OEM procedures, a whopping 48% said they support legislation requiring the use of OEM procedures.

Here’s why that concerns me. I’m all in favor of insurers paying for OEM procedures when that’s what you’re doing. But in all the time my team and I spend in shops throughout North America, we rarely if ever have seen a shop following 100% of the OEM repair procedures 100% of the time.

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