While insurance industry representatives protested that the auto claims process didn’t need the changes, Washington state residents and consumer advocates on Monday shared insurance war stories and backed reform legislation.
One consumer described a unspecified insurer holding firm on the quote and dragging out the process for months. The carrier ultimately agreed to pay about $3,800 more than their initial estimate — but still $2,000 short of the repair bill. Another described GEICO refusing to speak or clarify a refusal to pay for a repair bill prepared in a non-DRP shop. An appraiser described the insurance coverage industry going 0-87 last year in offering his clients the full amounts these were later confirmed to deserve.
Their testimony in support of House Bill 1428 seemed to illustrate what bill sponsor Rep. Steve Kirby, D-Tacoma, known as a process “heavily weighted” in support of the insurer's opinion on what ought to be paid.
Kirby, the chairman of the House Consumer Protection & Business Committee which held Monday’s hearing, described HB 1428 like a placeholder and said he would rewrite it. But he suggested a goal would be fixing this problem.
Washington Administrative Code 284-30-390 indicates customers may take their vehicle wherever they want. However, Kirby on Monday pointed to section :
If the claimant chooses to take the loss vehicle to a repair facility where the total cost to restore the loss vehicle to its condition before the loss exceeds the insurer’s estimate, the claimant should be advised that he or she may be accountable for any additional amount above the insurer’s estimate.
“In my experience, saying, as well as in practice it has actually been used, to imply that ‘that’s just the way it’s destined to be,” Kirby said.
If the insurer doesn’t accept the amount, “‘there’s not anything you can do about this.’ Ultimately, that’s the way it keeps winding up,” Kirby said.
A consumer could sue the carrier, but insurers have “armies of lawyers” and also the policyholder may not, he said. Also, he argued that no attorney would have a case over a $2,500 claim.
“It’s just unfair,” Kirby said. He explained he wasn’t trying to make the process unfair for insurers, but “Among the finest to level this arena.”
The placeholder text of HB 1428 offers the language Kirby’s committee endorsed 7-6 in last year’s HB 2782; that bill ultimately died without further action in Rules Committee.
“The insurer has the burden to prove the unreasonableness of vehicle repair procedures, charges, or both,” HB 1428’s starting language states. “Repair processes as defined in subsection of this are deemed reasonable and necessary.”
Subsection declares:
The draft bill at another point specifically exempts insurers from spending for OEM parts, and Kirby assured the alternative parts industry that OEM parts would not be some the revised bill.
Mel Sorensen, lobbyist for the American Property and Casualty Insurance Association, told the committee Monday that 284-30-390 was “right on point” in handling the claims process.
“It’s a good process,” said Sorensen . He said the association and its members “don’t believe that the bill is necessary.”
He said the trade group was “deeply concerned” about shifting the burden of proof towards the insurer, arguing this will “invite disputes” and “invite litigation.”
“Thousands of claims are handled without controversy, resulting in high-quality repairs, and insurers possess a terrific interest in making sure that repairs are carried out not only cost-effectively, but in an excellent fashion that produces a safe and reliable vehicle being returned to service,” Sorensen said.
Consumers challenge insurers
Customers and their advocates painted a different picture.
Mike Harber, an authorized professional appraiser who said he was representing the Professional Automotive Repair Alliance, told the committee he represented 87 insureds in disputes with their carrier — during the pandemic year of 2021.
“We won every single one of those claims,” said Harber .
The lowest-dollar case saw his client receiving another $1,200 owed on the claim, he explained. The biggest recouped more than than $65,000 underpaid by the carrier, according to Harber.
Brian Mather recounted his claims experience following an accident involving his MY 2021 truck last summer. The insurer had him take pictures and a short video, then produced a quote for $1,200.
The carrier told him to take the vehicle wherever he liked but “conveniently” sent info on its direct repair program facilities.
He said he took it to a local body shop with which he had a relationship and was assured it would be repaired per manufacturer standards.
“Given my truck am new, this was vital that you me,” Mather said.
The body shop’s quote was “almost $8,000,” Mather said. He said the insurer spent “several months” with the position “these were dedicated to their quote” or getting the vehicle fixed in their DRP shop.
He held fast on his chosen shop coupled with the repair completed. The insurer’s behavior dragged out a weeklong repair into one spanning almost 3 weeks, he explained.
“They ultimately paid more,” Mather said of the insurer. But this required pictures of every damaged part and waiting for approval each stage, according to Mather.
“A picture of each individual plastic clip which was removed to obtain parts off the vehicle had to be photographed and sent before it was approved for reimbursement,” Mather said.
Mather said he was able to collect
