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METRO NEWS | KEN REICH

Auto Repair Policies in Need of an Overhaul

November 12, 1998|KEN REICH

In 1994, an advisory committee of the state Bureau of Automotive Repair estimated that more than 700,000 structurally damaged and 150,000 salvaged, or previously "totaled," vehicles were returned to California roads every year.

The strong implication was that many of these vehicles were at least somewhat unsafe and that a second accident of equal severity could result in even more damage or injuries than the first.

The committee stated specifically:

"Although consumers were totally unaware they had received poor auto body repair, reinspection by experts indicated that the quality of repairs was quite low, and adjustments to the original invoices were made about 40% of the time."

It found that "auto body repair shops typically charged for repairs not made or changed the method of repair to a lesser quality . . . and failed to inform the consumer and the insurance company."

There was, naturally, considerable alarm at the findings, and legislation was passed requiring safety inspections of such vehicles. But it was poorly funded, and has scarcely been implemented.

Most of the inspections of such cars done now are not mechanical at all, but are conducted while tracking stolen vehicles, according to officials.

This, of course, is not the first time that a big problem is identified, but the costs of coping with it are so great that little is done.

It is actually at the body shop level that a few glimmers of progress can be seen, with the insurance industry beginning to be pressured to finance better repairs.

As usual, it is a few independent people who lead the way.

In Hawaiian Gardens, a body shop operator, Rocco Avellini, using a system called Wreck Check, has had some success inducing insurers to pay for correcting poor repairs or, from the start, financing better ones.

At Rocco's Collision Center, Avellini, a past president of the California Auto Body Assn., also is pushing a "diminished value" concept, whereby insurers are asked to reimburse accident victims for the lesser cash value of their cars, even after repairs are made.

In only a handful of states have some insurers begun paying.

The payments are rare in California. At Farmers, for instance, spokesman Jeff Beyer states flatly, "Coverage for diminished value is excluded."

The Wreck Check system was developed by James Lynas, a body shop operator in Marietta, Ga., and has now spread to 33 states. The only two outlets in California are in San Mateo and Hawaiian Gardens.

Costing $75 at Avellini's facility, Wreck Check provides a computerized evaluation either of what repairs are in order, or what has not been done right in a past repair. Avellini says he has yet to see, after the fact, a perfect repair.

Lynas noted courts have ruled that the object of repair is to completely restore the vehicle's function, appearance, safety and value.

Avellini acknowledged that his repair charges are 35% to 50% higher than those of most body shops.

But two visits showed he is busy, with a dozen vehicles under repair at a time, and documents indicated that insurance companies, sometimes under protest, do go along.

Sometimes, after poor repairs elsewhere, the result of a Wreck Check is to induce the insurer to total the car and pay the owner off.

This happened with Michael Roche of Huntington Beach, whose 1997 Ford Expedition was severely damaged in October 1997.

A seven-week repair cost $11,051, almost all paid for by State Farm, whereupon Roche, having heard about Avellini's diminished value assessments, brought the car in for a Wreck Check evaluation.

"At this point, I assumed that the vehicle had been repaired correctly and put back to pre-accident condition," Roche stated.

"[But] I learned that there were numerous items that were either not repaired correctly or overlooked. Two [were] the bent frame and reconditioned wheels."

*

After State Farm conducted five hours of its own reexaminations, it decided to "total" the car, and, on April 10, paid Roche a negotiated $35,069, slightly over book value.

Bill Sirola, a California spokesman for State Farm, explained:

"The body shop we relied upon first didn't do the job correctly. . . . We don't fix cars. We rely on our body shop partners to fix cars. Sometimes, we find out later those repairs weren't done correctly. We don't like it, our policyholders don't like it, so we fix it."

Sometimes, it is not quick. In the case of Frank Perreault of Lakewood, State Farm finally paid $3,305 to repair his car, but only after more than four months of protesting, during which it paid him $5,136 for rentals and towing.

Avellini observes, "This repair should have taken three weeks, yet the customer stood firm on his belief that he had every right to get his car repaired back to pre-accident condition and was willing to wait for State Farm to pay."

Sirola responded that statistics issued by the state show that customer complaints against State Farm are among the lowest for any insurance company.

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