New York: Insurers Did Not Steer Customers to Certain Body Shops

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An investigation by the New York Insurance Department has found that auto insurers in the state did not engage in a widespread effort to steer consumers to certain auto body shops – a violation of state law.However, in some isolated incidents, insurance company representatives engaged in practices “that could be considered violations of the (law) or regulations by providing improper or inaccurate information,” the department said in a release.The announcement by Superintendent Eric Dinallo follows two-year-old allegations by a trade association for body shops that insurance companies were illegally steering customers to designated collision repair shops.Many auto insurers in New York – and elsewhere – have created networks of affiliated repair shops, although auto insurers cannot force customers to choose their network of body shops.“This very thorough investigation is reassuring in that it shows auto insurers are largely complying with the laws that preserve consumer choice,” Dinallo said. “But it does raise some issues which the Department is addressing directly with certain individual insurance companies. Consumers have the right to choose where they want their cars repaired after an accident.”New York law prohibits companies from recommending or suggesting to their insureds that repairs be done at a particular place or shop unless their insured expressly asks for a recommendation. That means a company cannot make a referral – to its preferred program or repair shop, for example – during the claims process unless and until their insured asks for one.While most companies were found to comply fully with the Insurance Law and related regulations, the Department found isolated instances of noncompliance. __Source: New York Insurance Department
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