October 25, 2014
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Letters
Insurance industry ‘crying wolf’ over auto body legislation

To the Editor:

As a retired and disinterested third party with no axes to grind, but with 47 years of automotive factory and industry business management experience, I can knowledgeably and professionally state that the Body Shop Legislation Package, pending again in this year’s legislature, needs to be passed. The insurance industry has been riding roughshod, dictating to independent auto body repair shops absolutely ludicrous low dollar-per-hour payments for the kinds of professional work required today to fix today’s automobiles.

I have, in a vehicle manufacturer capacity (I worked for Porsche, Audi, VW and SAAB Cars USA, here at their American headquarters, and regional offices) while trying to prepare financial forecasts, profit and loss statements, etc., actually seen, on numerous occasions, wherein the all but forced per-hour body labor rate insurance company adjusters were offering (actually demanding a body repair shop accept) did not cover the actual per-hour employee cost of the shop ... an actual cost that includes the tech’s actual hourly rate, benefits and other related employee costs such as Social Security, TDI and health and dental care benefits!

And, yet, when they had to deal with “mechanical repairs” without question, as they could not dispute the factory times, etc., these insurance companies paid the going, posted “mechanical labor rate.”

The insurance industry is crying wolf on this legislation, as it has long clamored ... claiming it may raise premium costs to the consumer.

Truth be known ... if the RI Department of Business Regulation Insurance Office were to do due diligence on this matter, and not allow the obscene, uncalled for rate increases the industry often cries for, rates would not go up!

Rather, insurance companies would not be able to unfairly extort the obscene profits that they make off of the backs of auto body shop owners, and their technicians, by not paying them fairly for the quality work that they are trying to perform ... along with their using quality, factory replacement parts versus the crap being shipped in from China and elsewhere, that do not meet the high-quality and safety standards that insurance adjusters also often demand.

Tom Letourneau

Cumberland


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