New Jersey DOBI to Auto Insurers: We’ll Be Watching P&M Calculations

Post 205 of 251

New Jersey DOBI to Auto Insurers: We’ll Be Watching P&M Calculations

 

The New Jersey Department of Banking and Insurance has issued a bulletin cautioning insurers about their calculation of paint and materials reimbursement in auto damage insurance claims. The bulletin clarifies existing regulations that require insurers to pay for paint and materials, and informs insurers that the methods or tools they are using to calculate P&M costs may be outdated or incorrect. The DOBI bulletin urges insurers to use current guides (available through various third party databases) to properly arrive at more accurate figures. Additionally, the bulletin warns insurers that continue to arrive at insufficient allowances that they will be held accountable by the State.

 

 

“When comparing costs and the information we provided to the DOBI’s examination [of insurer P&M allowances], it became clear that the amounts being paid by some insurers were nowhere close to where they should have been,” says AASP/NJ Legislative Chairman Brian Vesley, who has been a key figure in presenting information on the matter to the State for over eight years. “We weren’t getting paid what it cost us, never mind making a sufficient profit. When we told the DOBI this, they were shocked. And after many years of cited examples, complaints and documentation, we’ve been able to get [the DOBI] to understand this is a real problem for consumers being denied reimbursement for proper repairs.”

 

 

“This bulletin puts the industry on notice of what is proper practice, and also says that insurers are obligated to make adequate reimbursement to shops,” Vesley continues. “The issuing of this bulletin is a landmark event that places an emphasis on the duty of insurers to justify how they arrive at the amounts they are willing to pay. It should also help eliminate the ‘take it or leave it’ attitude that’s been assumed by many insurers regarding this issue.”

 

 

“Brian has worked extremely hard on this issue for many years,” explains AASP/NJ President Tom Elder, “and this bulletin is a prime example that our voice as an association IS heard by the powers that be. The DOBI took our concerns seriously and has issued a guideline that will hopefully solve an issue that’s been plaguing our industry for years. I commend Brian and all involved for their efforts surrounding the P&M issue, and congratulate them on this achievement.”

 

 

For the full bulletin, visit the DOBI website at http://www.state.nj.us/dobi/bulletins/blt07_20.pdf

 

Tags: