Arizona Automotive Glass legislation that could affect Arizona car owners

Auto Glass repair Tucson AZ

Arizona Automotive Glass legislation that could affect Arizona car owners.

Auto glass replacement is not a glitzy business, but there is one company who you probably automatically think of when you think of auto glass replacement. No doubt, Safelite has done a great job marketing themselves and they possess a large share of the auto glass market. You might even be singing their jingle in your head right now.

For glass companies marketing to Arizona drivers, some new legislation could have shaped how they are allowed to reach consumers. Thanks to an automotive glass bill passed by the Arizona House of Representative Insurance Committee on February 3. This new legislations was designed to amend loopholes to prior insurance statutes designed to regulate the way automobile glass repair and replacement is marketed.

The bill titled “Unlawful Practices: Auto Glass Repair,” was approved by a unanimous vote in the House, but received a “no” vote in the senate. However, because the committee voted no, the bill will not move on to another committee nor to a full state Senate vote at least for now.

HB 2500, as the bill was called in the senate, was designed to amend an insurance statute to regulate the marketing of automotive glass. The legislation also would have made it unlawful for automotive glass shops to “take an assignment of any claim relating to the repair or replacement of auto glass.”

The bill would have made it a class six felony for a company to take an assignment of benefits on an insurance claim. A post loss assignment of benefits is what allows glass companies to bill the insurance companies directly for work performed and is considered to be standard practice in the auto body repair industry.

Typically what happens in an auto body repair or a glass replacement where you are using your body shop to file and handle you claim on your behalf, you are dealing with assignment of benefits. This allows the shop to get paid a lot faster, and it saves the customer from having to file the claims paperwork, get the check, cash it and then pay to shop to do the repair work. In this case for Arizona, tis legislation would have made it illegal for the shop to become the recipient of the repair funds on your behalf.

Arizona would have been the only state in the Union where an assignment of benefits is forbidden. Currently all 50 states allow this. An assignment of benefits is used in body shops, home damage/repairs, even health insurance claims. An assignment of benefits is not considered fraud and does not encourage fraud in any way.

Some Arizona auto glass company owners voiced their opposition to the bill.
The president of the Arizona Auto Glass Association said the bill “appears to be an excessive over reach by the insurance companies, Safelite and their associates and agents. As an association, we recognize there are parties that operate in a fraudulent manner. However, this bill would punish the honest service providers while making no distinction between the two.”

Most of the comments from the committee representatives dealt with their distaste for car washes, door-to-door salespeople and people offering glass repair on the side of the road,” said Soat. “My company has 85 operators working in some 20 states, and we operate in states ‘without’ the zero deductible. I wanted them to know that if the zero deductible disappears tomorrow windshield repairs would still be free in the state of Arizona because most of the insurance companies waive deductibles for repairs.”

Auto glass companies such as Safelite AutoGlass supported the legislation:

“Safelite is very disappointed that the committee voted not to pass this critical legislation that would protect Arizona consumers from unscrupulous and predatory practices that exist in the vehicle glass repair and replacement industry,” says Scot Zajic, Safelite’s vice president of legislative affairs. “This bill was supported by many Arizona-based glass shops, national anti-fraud groups and insurance companies whose sole purpose was to eliminate these practices that allow profiteering on the backs of consumers and their hard-earned insurance premiums that they pay.

Those in favor of the legislation feel that consumers are steered towards unscrupulous fly-by-night glass repair and replacement companies who offer discounts such as cash, rebates and kickbacks to the customer for choosing them to do the repairs.

The bill was ultimately killed in the senate and will take some time before it can go before the senate for a vote in the future.

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