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Understand your collision repair shop's liability risks

Friday, March 1, 2019 - 09:00
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Editor’s Note: This article was originally published by Dealer Magazine.

Everyone in the industry has heard of the $30 million-plus award against a franchised dealer’s Texas bodyshop for gluing a roof on a Honda Fit, as instructed by the insurance company, versus the 128 welds as it was manufactured originally. A subsequent relatively minor accident caused the passenger compartment to collapse onto the occupants, causing severe injuries. 

And the insurance company was not held liable for anything; the entirety of the repair liability was laid on the shop for choosing not to do the repair per OEM specs. According to the courts, the shop personnel had a choice to repair properly regardless of the insurance company’s compensation, or to not do the job. Ouch!

SEMA speaks

The one-of-a-kind annual SEMA extravaganza always features literally hundreds of learning opportunities, including informative I-CAR workshops, a plethora of booth demonstrations and professional presenters from all facets of the automotive industry. To say it was an eye-opener regarding individual shop collision liability would be the proverbial understatement, especially learning that insurance companies are off the hook, no matter what they will or will not pay for or instruct in any repair process. 

A workshop, “Understanding Shop Liability in this Era of Diagnostics, Calibrations, and Programming,” featured a panel of collision industry professionals including Mitchell’s SVP of Sales Jack Rozint; Technical VP Aaron Clark (ASE Master) from Assured Performance Network; Chuck Olsen, director of operations AirPro Diagnostics; Senior VP Nick Notte, I-CAR; and American Honda’s Scott Kaboos, assistant manager collision marketing. Each of these professionals was well-versed and integrated into vital portions of the automotive collision world. 

The session was moderated by SVP of Business Development Michael Quinn of AirPro Diagnostics. The capper of this was an introductory talk by none other than Todd Tracy, the aggressive lead lawyer in the aforementioned multi-million-dollar collision settlement. 

We were reminded that insurance personnel “are not the experts,” and that the collision repairers are the ones who make the right or wrong decisions. Every collision professional has the choice of refusing a job based on insurance payment coverage or collecting extra funds from the vehicle owner to do it correctly. Doing it inadequately or incorrectly should never be an option.

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