by Bill Batley
June 27, Farmers Insurance sent a letter entitled Breaking News to all
its agents and district managers. In the letter, the company announced changes
to its glass claims reporting procedure. It truly was breaking news, but, sadly,
it marked a serious step backward in a glass program that was already marginal
at best. The breaking news, as the newsletter describes, was an extension of the
Farmers HelpPoint claims service to incorporate the FASGLASS program. This may
sound exciting, but what does it really mean?
started with four national auto glass companies and was merely a call router
designation on an 800 number. Customers would call the number and one of the
four companies would handle the claims through an allocation basis. Now FASGLASS
has been reduced to two companies, and based upon my estimation, 9 out of 10
calls are allocated to SGC; the few remaining calls are allocated to Harmon.
To say that HelpPoint has been extended to the
FASGLASS program simply means that the insured needs to call through a larger
and more confusing phone tree, only to select auto glass claims, which then
forwards the call to the FASGLASS router.
major change has been the withdrawal of LYNX from the FASGLASS program. When
LYNX was one of the options, the Farmers program had the potential of becoming
an open program. Now that LYNX has pulled out of the program, reducing FASGLASS
primarily to SGC, the program is even less likely to ever become a fair and open
notable change is that glass shops can no longer call to report a glass
claimóonly the insured can make the call. Why is Farmers Insurance opposed to
having auto glass companies talk directly with FASGLASS (SGC Network)?
One obvious reason is it takes away the ability of the SGC representative
to direct the job to a Safelite shop.
Insurance seems to have overlooked the fact that my customers choose to come to
my shops because they have confidence in the work we do. Most also believe they
are insured by a competent, reliable insurance company; otherwise, they
wouldnít continue to pay the premiums. Why then must many of these same
customers be told one or more of the following responses when they call SGC to
open a claim?
canít find that shop in our database, but we donít guarantee its work, and
it may overcharge Farmers, and you will have to pay the difference.Ē
Sound ridiculous? And what is the Farmers insured thinking at this point,
particularly when he believes he has been talking directly to a representative
of his own insurance company?
doesnít seem to matter if we are listed as a participating shop with SGC. We
are treated the same regardless. Since we get virtually no referrals and we
canít call in and get a referral number for prompt payment for our Farmers
insured, our customer has to call Safelite (a national competitor) and then
faces the prospect of being directed away from our shop. If we manage to keep
the job, SGC pays me an average of $50 for a repair, but Farmers pays
approximately $200 per incident, allowing our competitor to make close to $150
off every repair we do for Farmers.
constant attempt by SGC to direct all the business to itself seems to me to be
anti-competitive. Now, with the inclusion of incident pricing, it seems even
more so. What is the value of my repairs to Farmers Insurance?
Isnít this a moot point since, according to sources with whom Iíve
spoken, I estimate that Farmers pays Safelite approximately $200 per repair?
Every repair on the per-incident pricing helps Safelite, a competitor, achieve the cost structure (price) it gave Farmers Insurance. By doing the right thing for my customers in repairing their windshields, I actually benefit my competitor. In reality, Iím funding my competitor, who wants to put me out of business. At that point, Iím left to think, why should I do repairs at all for Farmers?
Bill Batley is the president of the National Windshield Repair Association and owner of NOVUS Windshield Repair in Seattle.
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