To Waive or Not to Waive
by Mike Boyle
It’s been almost five years since State Farm’s decision to stop waiving
the deductible for windshield repair, and, as a National Windshield Repair
Association (NWRA) member recently inquired, why?
Company officials have argued that by not waiving the deductible, the
company is not backing away from repair, but that it continues to encourage
it. Moreover, company officials also have stated that many of its insureds
have no deductible for comprehensive claims and therefore the company
does end up paying in whole for many windshield repairs.
The Big Picture
These may be valid arguments. However, some see a larger picture: For
even if something makes financial sense, does that in and of itself supersede
a company’s social and environmental responsibility?
While State Farm is a leader in regard to the number of people it insures,
the company is missing an enormous opportunity to be an environmentally
conscious industry leader.
It is estimated that NWRA/GGCA members have repaired more than 60 million
windshields in the past ten years. To date, the association is unaware
of any accident as a result of a repair, nor of any safety issues.
And best of all, windshield repair is one of the original “green” processes.
Moreover, by waiving the deductible for windshield repair for its policyholders,
State Farm would assist in a possible increase in the number of automotive
glass repairs performed annually, allowing State Farm to be in a position
to actually lower premiums for its policyholders (by saving overall costs),
while also decreasing liability for its company (by promoting the safe,
time-tested process of windshield repair). Best of all, State Farm would
be seen as an environmental leader—by encouraging its policyholders to
actively seek out repair, whenever possible, by waiving the policyholder’s
deductible. The NWRA/GGCA stands ready to publicly applaud its efforts
as an environmental leader in the automobile insurance industry.
“State Farm would
be seen as an environmental leader—by waiving the
Sadly, the recent events that have occurred in the Gulf Coast have reminded
us that oftentimes the socially responsible course of action may be ignored
in favor of that which will bring greater profit. While being an environmental
leader is an oft-lofty goal for many companies, the plain fact is that
profits typically drive company decisions, with socially conscious policies
coming about as an unintended consequence.
The NWRA/GGCA will take it either way. Bottom line: Windshield repair
makes common financial sense—a windshield repair costs much less than
windshield replacement. Now, we all know there are instances when windshield
damage cannot simply be repaired, but why not be proactive and repair
damage as soon as possible? Saving money is a great motivator to many—if
a State Farm policyholder notices repairable damage on his or her windshield,
he or she is more likely to get the damage repaired if it is understood
that it will be done at no cost to them. State Farm could save money by
heeding off unnecessary replacements. And with “bait and switch” schemes
and insurance fraud being an ongoing issue, it may also save both State
Farm and its policyholders more money than just the cost of the deductible.
But in the end, the whether or not State Farm reverses its policy regarding
windshield repair and deductibles, windshield repair technicians must
take it upon themselves to be the best at what they do. And the NWRA will
stand by its members’ sides—continuing to offer educational and networking
opportunities to its members in order to help them increase business.
The NWRA will continue to engage in dialogue with State Farm and any other
insurance company that elects to not waive the deductible of its policyholders
for windshield repair. However, the best education occurs during dialogue
with your customers. Remind them of the environmental benefits of windshield
repair and that while their insurance company may or may not waive their
deductibles that they will save time and money by opting for a repair
over a replacement, and that it’s good for the environment, too.
Mike Boyle is the president of the NWRA. He also serves as president
of Glass Mechanix in Bend, Ore. Mr. Boyle’s opinions are solely his own
and not necessarily those of this magazine.
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