IGA Urges NCOIL to Complete Model Anti-Steering Act; Belron US Proposes Glass Be Removed, Name of Act Be Changed

Independent Glass Association (IGA) executive director Mike Russo has authored a letter to the National Conference of Insurance Legislators (NCOIL), urging the group to act in creating model anti-steering language.

NCOIL, a group of state legislators from across the country, met last week in Boston to review the language. Russo spoke during the meeting and also presented his letter of support to Sen. Ruth Teichman (R – Kan.), who chairs the property-casualty committee developing the language.

In the letter, Russo advises that windshield installation service “has been reduced to a commodity rather than the professional service it provides.”

“With this in mind, we urge the members of the National Conference of Insurance Legislators to act,” he says. “Legislation protecting a consumer’s right to choose a repair shop is imperative and a matter of public safety. In our view, legislators must understand that anti-steering legislation is pro-consumer and in the best interests of their constituents. Current practices in place in the auto glass repair and replacement industry focus on cost rather than consumer safety.”

Russo also says that, though many states currently have anti-steering legislation, “the legislation is either defeated or diluted to the point that it clearly favors the insurance industry, rather than the consumers who it is meant to protect.”

He adds, “For the sake of your constituents, we urge you to begin the process to put consumers first when you convene this week at your conference in Boston.”

Russo says last week’s meeting regarding the language seemed to be a positive one.

“It appeared that some of the members of the committee were well aware of what is taking place in the auto glass industry and it was refreshing to hear,” he says. “One member of the committee was an insurance agent and spoke pointedly to the obstacles his policyholders encounter in reporting a glass claim. But it is still apparent that much needs to be done to educate the legislators on the anti-consumer practices in the auto glass industry. The presence of the third-party administrators in the auto glass industry does not benefit consumers and it certainly does not promote competition.”

Belron US also had authored a letter to Teichman regarding its stance on the legislation (CLICK HERE for related story), and has made several suggested revisions to the model act.

In its proposed changes to the amendment, Belron US is suggesting that auto glass claims be removed from the realm of the act, and that its name be changed from “Model Act Regarding Insurer Steering” to “Model Act Regarding Consumer Choice in Autobody Repair.” The company also is proposing that the summary of the bill be changed so that, in addition to focusing on consumer choice, it also focuses on prohibiting incentives provided to insurers.

Belron US is proposing that the words “mandates certain disclosures, and establishes violations as unfair claims settle practices” would be removed from the summary of the act, and replaced with: “and prohibits the offering and acceptance of incentives in exchange for the referral of a particular insured to a repair facility.”

The proposed changes from Belron US also would remove language that would have changed payment guidelines for network versus non-network shops and would replace it with language that prohibits providing incentives for insurance agents and insurers to offer referrals.

Belron US is proposing that the following sentences be removed:

[An insurer authorized to do business shall not] recommend a repair facility once an insured or claimant has advised the insurer that one has been selected, or interfere with the insured or claimant’s selection once it has been made; and

[An insurer authorized to do business shall not] pay a non-preferred facility selected by an insured or claimant less to complete a repair than the insurer would have paid a preferred repair facility for the same work.

The company proposes that the above instead be replaced with the following language addressing incentives:

No repair facility shall offer a rebate, gift, gift card, cash, or anything of value to an insurer in exchange for the referral of a particular insured to that repair facility;

No repair facility shall offer a rebate, gift, gift card, cash, or anything of value to an insured in exchange for that insured filing an insurance claim for auto body services.

Nothing in this section shall prohibit an insurer from entering into a preferred provider agreement or from participating in any direct repair program or direct repair network with repair facilities.

NCOIL has decided to continue discussion of the model steering language at its next meeting, to be held in Austin, Texas, this November.