Auto physique outlets push for replace on reimbursement charges

Auto physique restore store house owners instructed lawmakers they’re reimbursed by insurers at a median charge of about $40 per hour — which they mentioned is the bottom within the nation — and pressed for laws regulating minimal labor charges.

“In 2010 after I opened my enterprise, insurers have been reimbursing customers a labor charge of $40 an hour. Eleven years later, the identical insurers are reimbursing customers the identical labor charge of $40 an hour,” Brian Bernard, proprietor of Complete Care Accident Restore in Raynham, mentioned. “Eleven years with a zero % enhance in that charge. In the identical interval, your insurance coverage premiums have elevated 48 %.”

Representatives and senators on the Joint Committee on Monetary Companies took the testimony Wednesday in a preview of a debate that’s anticipated to happen earlier than a brand new particular fee by the tip of this yr.

Bernard, the Alliance of Automotive Service Suppliers of Massachusetts and others supported a handful of payments coping with the problem, together with H 1111 from Rep. James Hawkins, which might require that insurers reimburse auto physique outlets at a minimal charge equal to the speed on the time the Insurance coverage Reform Act handed in 1988, adjusted for inflation. Afterward, the speed could be adjusted primarily based on the Client Value Index.

In line with the U.S. Bureau of Labor Statistics, $1 in 1988 is the same as $2.36 of shopping for energy in 2021.

Hawkins mentioned he ran an auto physique store earlier than turning into a trainer and was “fairly concerned” as a member of the Rhode Island Auto Physique Store Affiliation. Again then, about 25 years in the past, the labor charges insurance coverage firms paid to outlets was about the identical as it’s at the moment.

“I simply had my truck serviced on the Chevrolet vendor, that’s $125 an hour for labor. I dropped off my RV to be serviced this week and that’s $175 an hour. And we’re solely paying the auto physique outlets $40 an hour,” he mentioned. “And that’s not what the staff get, that’s what the store will get.”

Christopher Stark, government director of the Massachusetts Insurance coverage Federation, urged lawmakers to not return to “authorities price-fixing” greater than a decade after Massachusetts officers deregulated the automotive insurance coverage market from a “fastened and established system” to “managed competitors.”

“We’ve realized our lesson… Massachusetts, via that whole time of fastened and established, was constantly the fifth, the seventh, highest premiums within the nation,” Stark mentioned. “However after we made these reforms and ended that sort of presidency price-fixing, we fell to fifteenth and we stay 14th.”

The Legislature’s particular fee is meant to carry at the least two public hearings “in geographically various areas,” of the state and is anticipated to file a report with its findings and proposals by Dec. 31.

— Colin A. Younger / SHNS

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