Volume 13, Issue 6 November/December 2011

Insurance Talk
Policy brief

State Farm Adapts Offer and Acceptance Program
State Farm has updated its Offer and Acceptance (O&A) program to create two levels of O&A participant status, effective October 12. There now remains a basic O&A level participant status. A “Select O&A” participant status has been added.

There are three requirements for O&A participants to be considered to quality for “Select” status:
• time in the program (a minimum of 365 days);

• minimum claim volume (60 claims per three-year period); and

• electronic invoicing.

“Once you have those three pieces, you can be reviewed for ‘Select’ status,” says Melissa Kern, team manager for glass claims service for State Farm.

Beyond that, those shops that meet certain key performance indicators (KPI) based on quality, efficiency and competitive pricing can attain Select status.

Select O&A participants differ in a couple of ways from other O&A providers.

“If a customer doesn’t have a pre-determined shop choice, Select O&A providers will be offered,” says Kern.

In addition, “only Select O&A participants will be permitted to make customized offers,” says Kern.

Select O&A participants will be reviewed on a continuous, quarterly basis.

In addition to these changes, State Farm also has moved to an hourly labor rate.

Kern announced these changes at Auto Glass Week™ in Memphis, Tenn., in September (see related story on page 22).

Elephant Insurance Begins Requiring Some Auto Glass “Inspections”
Richmond, Va.-based Elephant Insurance (EI) has joined the ranks of insurers that sometimes require inspections prior to authorizing auto glass work, according to company officials.

“Due to an increasing frequency of auto glass claim insurance fraud, more and more insurance companies have altered their traditional claims process,” says Brian Wakefield of EI. “This may involve a physical inspection of the alleged damage prior to the vehicle being repaired. This allows the insurance company to confirm that the damages are consistent with the reported claims.”

It is unclear how the EI inspections are being conducted, and EI officials have not responded to AGRR™ magazine/glassBYTEs.com™’s requests for comment.

EI is a relatively new insurer, launched in 2009 by United Kingdom-based Admiral Insurance, according to information from the company’s website. Elephant offers automotive policies in Illinois, Maryland and Virginia.

Washington Auto Glass Shop Owner Ordered to Pay $1.6 Million in Restitution to Insurers

Michael Perkins, the owner of Autoglass Express Inc. and Premier Auto Glass LLC in Burien, Wash., has been ordered to pay more than $1.6 million in restitution to several insurance companies for what prosecutors have called “an overbilling scam.” Perkins recently was sentenced to nine months jail (in a work release facility), 240 hours community service and restitution, but the amount of restitution sought was not released at the time of sentencing (see related story in September/October AGRR™, page 18).

The breakdown of the fine, which was imposed by the King County Superior Court, is as follows:
• State Farm Insurance: $864,640;

• Allstate Insurance Co.: $726,700; and

• Metropolitan Property & Casualty Insurance Co.: $24,888.

Prosecutors alleged that Perkins’ company “told insurers that higher-priced original-equipment manufacturer (OEM) glass had been installed, when workers were actually installing lower-cost aftermarket glass.” Perkins pleaded guilty to three counts of first-degree theft in April.

Allstate filed its own civil suit against Perkins, his wife, Trena, and their companies earlier this year, and has been awarded a $726,00 judgment in that case.

briefly …
California Casualty Management Co., based in San Mateo, Calif., recently recognized Gerber National Glass Services with a “Customer Service Excellence Award” for 2010 ... According to the latest report from the National Insurance Crime Bureau (NICB), “questionable” auto glass claims dropped 67 percent for the first half of 2011, when compared with the first half of 2010.

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