Consumer advocates are concerned about a bill that could ostensibly undo a current Calif. law preventing insurers from "steering" customers to auto body shops under contract with the insurer.
Calif. Assemblywoman Mary Hayashi (D-Hayward) is spearheading the proposal — AB 1200 — which would allow insurers to present reasons as to why customers should use "preferred" body shops at any time during the claim process. This would represent an obvious departure from the anti-steering law enacted in 2003 (SB 551 – Speier), which specifically prohibits insurance companies from dictating that customers get cars repaired at certain establishments. The state law actually goes one step further, stipulating that insurers must refrain from "suggesting or recommending" body shops once the person has selected a repair facility.
Consumer Watchdog, a nonprofit, nonpartisan group, recently sent a letter to Hayashi to not only voice its disapproval for the amendment but also urge that the current law be upheld. It believes, as do other consumer advocates, that 'hard selling' can erode workmanship and driver safety because shops might be more inclined to cut corners in order to save the insurer money and potentially earn standing as a "preferred provider."
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