Volume 12, Issue 5 - September/October 2010

Repair Round-Up
nwra reports

In Defense of Our Industry

by Mike Boyle

Auto insurance fraud and aggressive solicitation of consumers aren’t new concepts but it does appear they are being reported with greater frequency. The repair industry is not immune to such complaints.

On a regular basis, the staff of the NWRA receives complaints from members regarding insurance companies and their respective third-party administrators (TPA). These entities have been a perceived albatross around the neck for many in our industry and our members look to the NWRA to help them with insurance- and TPA-related issues on a frequent basis.

The complaints generally heard from members include reductions in job referrals from insurance companies, the designation of shops as “non-preferred” and incidences of steering.

Competing Against Goliath
So, how is a shop to compete against these Goliaths?

Many within our industry would tell you that they have moved away from relying on insurance referrals and have taken the fate of their business and its marketing efforts into their own hands. Good word of mouth can be your best marketing tool. The ability to perform skilled windshield repair, while providing excellent customer service, is the responsibility of every repair technician—and with referrals becoming less frequent—is the business model you need to live by in order to survive.

Defrauding insurance companies or overly aggressive solicitation of customers is not acceptable.

Of course, we have all heard of instances of fraud within our industry. These include individuals involved in “bait-and-switch” schemes, repairing a pit on windshield, but reporting it to the insurance company as a break as well as technicians performing so-called “stress tests” on damaged windshields, in hopes of creating an unrepairable crack.

“Aside from the financial losses of the insurer, insurance fraud also affects innocent people.”

The Rise of Fraud
In early August, the National Insurance Crime Bureau (NICB) released its first half of 2010 “questionable claims referral reason analysis” (QC). The report examines six referral reason categories of claims—property, casualty, commercial, workers’ compensation, vehicle and miscellaneous. Overall there was a 14 percent increase in QCs in four of the six categories in 2010 when compared to the first half of 2009.

Most troubling is the NICB’s report findings of a 107 percent increase in questionable hail damage claims and 527 percent increase in questionable auto glass claims so far this year when compared to the first half of 2009.

In the organization’s press release touting the release of the report, Joe Wehrle, NICB’s president and chief executive officer, states that NICB is noticing “concern from our members about criminal rings that are deliberately damaging vehicle windshields in order to file an insurance claim, and, in some cases, are not doing satisfactory repairs or replacements.”

Nevertheless, insurance fraud has existed ever since the inception of insurance itself. Fraudulent claims account for a significant portion of all claims received by insurers and cost billions of dollars annually.

Aside from the financial losses of the insurer, insurance fraud also affects innocent people—both directly through accidental or purposeful injury or damage and indirectly as these crimes cause insurance premiums to be higher.

While there will always be a few bad apples in any industry, I know the majority of us do not commit fraud nor engage in overly aggressive solicitation of windshield repair. It does still happen, though.

We’ve all read about the recent allegations concerning aggressive sales tactics—including door-to-door solicitation— by associates working on behalf of certain auto glass repair companies.

While the NWRA agrees that direct solicitation of services may prove beneficial in the marketing of your company’s services, discretion should be taken when approaching a potential customer. And, keep in mind, a permit or license also may be required.

Bottom line: don’t be overly pushy and don’t intimidate your potential customers with over-the-top sales tactics.

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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