VACC has ‘gutful’ of the car insurance industry

‘Can I choose the repairer I want?’ is the question motorists should ask their insurance company.

Victorian Automobile Chamber of Commerce has called in the Victorian Government to legislate to protect consumers’ rights over choice of repairer.

The VACC has also called for insurance companies to end unethical market practices and to stop treating motorists unfairly.

A Channel Seven’s ‘Today Tonight’ program reported that some insurance companies were increasingly diverting motorists away from the repairer they choose to the insurance company’s ‘preferred repairer’. The program also reported that some insurers were:

• quoting for repairs from photographs instead of personally inspecting the damaged vehicle;

• pressurising ‘preferred repairers’ to fix vehicles cheaply, resulting in corners being cut, substandard repairs and unsafe vehicles;

• offering cash settlements to motorists that do not cover the full cost of repairs.
“We have had a gutful of the treatment dished out to repairers and motorists by the insurers,” VACC executive director, David Purchase, said.

“Increasingly, insurance companies are directing motorists towards their preferred repairer network. Their actions deny motorists’ control and freedom of choice.

“Insurers are unfairly, unreasonably, and increasingly arbitrarily, reducing quotes so low that the repairer cannot repair the vehicle properly. As a consequence, we have poorly repaired, devalued and, potentially unsafe vehicles out on the roads.

“It is not as if insurance companies need to screw us to the floor boards in order to survive. They are making enormous profits. They are supposed to be providing a service, but once a customer signs the policy papers, the insurance company controls the process.

“We want government to bring the insurance companies back into line.

“Insurers are good at asking consumers’ questions and insisting on truthful answers. We should expect honesty from them in return. It is not good enough to have a clause buried in the small print of the ‘product disclosure statement’ about choice of repairer. It needs to be clearly identified and open for discussion from the outset.

“VACC calls on the state government to pass legislation that requires a consumer is told about the choice of repairer provisions being offered in a comprehensive car insurance policy.

“And VACC recommends all motorists ask their insurance company the following question: ‘Can I choose the repairer I want?’,” Purchase said.

Your comments

When this story first appeared on www.paintandpanel.com.au, it aroused may comments and feelings from within the industry.

Some of the comments included:

“I’ve been out of the trade for years and never been happier. Now I fix my own cars for a hobby. Insurance companys are parasites.”
– Anthony

“I am in the process of writing a letter to Suncorp about a job that was faxed through to us with $1000 cut of the price. The labour time was cut and the price is $26.00 and $28.00 per hour.  No tradesman will work for this pay, so how am I supposed to run a business on this level.”
– Bill Bowen Smash Rep N.Q.

“This practise has been happening here in NSW also. The major insurer in NSW had advised me “what can we do, the winning quote is cheap”.
This was even after I and other repairers advised them that the so-called new parts to be fitted to the vehicle were to be invoiced to the insurer cheaper than the Holden distributor could purchase them. Again the answer was “they have submitted the cheapest quote, what can we do”.
I asked the insurer to carry out a re-inspection and monitor the repair to the vehicle to ensure the correct work and parts were to be carried out and they declined.”
What a surprise.
– Garry

“On a recent job my customer informed me that they had been contacted by the local (insurance preferred) repair company stating that tha damaged vehicle was booked in for assessment with them. This was on the same day that I was booked to have the assessment done on the vehicle. Obviously the insurance company has contacted the repairer and given the details even though the customer had listed me as her preferred repair.”
– Stephen King Panelbeating Kempsey NSW

I’ve heard it all before from the toothless tiger (VACC). It would be good to see David Purchase do something instead of saying something. It appears to be a process of quick with words and slow with action. If you’re going in to fight on behalf of the repairers then stop hiding behind a myriad of excuses and put it all on the line.
The VACC has had this problem in their lap for over 20 years and members continue to pay good membership after bad results year after year. If you can’t make a difference David move over and give it to someone who can. If you’re not making measurable progress in reasonable time, make substantial changes.
The ability for the insurance companies to get to where they have is a true reflection of what opposition they’ve encountered by industry leaders. I don’t blame the insurers as much as I blame the industry leader’s lack of assertiveness.”
– Gary

It is time that this issue was dealt with, right across the board, insurance companies have treated the repairer unfairly. If polled, most panel shops are on the brink of survival, assessors slash all normal prices, resulting in cut corners, and then pay the repairer from 30 to 90 days, leaving the repairer to foot the bill. Backyard business’s have profited from this by undercutting the repairer. There is talk that panel shops around the country will close for a week to get the attention that is needed for this problem - I hope this happens.
– Nikki