American Property Casualty Insurance Association
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Frank O’Brien

Jeffrey Brewer








March 17, 2014

Legislature Considers More Bad Auto Body Bills

PROVIDENCE, R.I. - Tomorrow, three auto body bills will be heard by the House Committee on Corporations that must be defeated to protect Rhode Islanders’ inherent rights as consumers.

“Representatives Stephen Ucci and Arthur Corvese, the bills’ sponsors, have the Auto Body Association of Rhode Island’s (ABARI) best interests in mind, rather than what’s best for consumers,” said Frank O’Brien, vice president state government relations for the Property Casualty Insurers Association of America (PCI). “These bills are the continuation of a decade-long legislative agenda from the body shops that has increased the cost of auto body repairs. As a result, Rhode Island now has the second highest average body shop collision repair cost in the U.S. Legislation intended to increase the amount paid for auto body repairs or limit the role of auto insurers in the claims process, hence reducing insurers’ ability to provide “checks and balances” on behalf of their customers has an impact. And that impact comes at the expense of Rhode Island consumers.”

The committee will hear the following three bills:

H-7404 seeks to expand the current 30-month ban on the use of aftermarket auto body replacement parts to apply to any motor vehicle body replacement part not manufactured by the manufacturer of the motor vehicle. As an example, this legislation would outlaw the use of a windshield wiper that was not manufactured by a car company or the use of other commonly used replacement parts. This restriction could increase the cost of auto body repairs, which is one of the many factors affecting insurance premiums.

H-7405 addresses the use of used and/or re-manufactured airbags or suspension parts in the unfair claims practices law. However, Rhode Island already has a law addressing the issue of unscrupulous repairers who fail to replace, or who install fake air bags. This legislation is simply another attempt to restrict the use of aftermarket parts.

H-7796, requires the establishment of two categories of body shops. The so-called “A” and “B” shops would have different labor rates which could confuse consumers and force insurance companies to pay more for the same service depending on the type of classification of the auto body shop making the repair. This bill is also aimed at decreasing competition among body shops.

In addition to reviewing the current legislation before the House Corporation Committee, PCI will showcase its examination of the impact of ABARI-supported bills over the last decade through a special report that highlights the rapidly rising costs in the state’s auto repair system. Key findings include:

·         The 2013 average body shop collision repair cost in this state is 28.5 percent higher than the national average. Ten years ago — at the beginning of ABARI’s campaign — Rhode Island’s average collision repair cost was only 2.5 percent higher than the national average

·         Over the last decade, Rhode Island’s total body shop labor costs have grown significantly —roughly 3 times faster than the countrywide average.

·         Rhode Island now has the 2nd highest average body shop collision repair cost in the nation. A decade ago Rhode Island had a much lower ranking at 13th highest.

PCI is urging the House Committee on Corporations to stand with the people of Rhode Island and oppose legislation that could further increase auto body repair costs and continue to adversely affect drivers across the state.

PCI is composed of more than 1,000 member companies, representing the broadest cross-section of insurers of any national trade association. PCI members write over $195 billion in annual premium, 39 percent of the nation’s property casualty insurance. Member companies write 46 percent of the U.S. automobile insurance market, 32 percent of the homeowners market, 37 percent of the commercial property and liability market, and 41 percent of the private workers compensation market.


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