Montana Insurance Bill Passes Senate — It’s Worrisome to Some

In the Montana Senate, State Farm fought Senate Bill 356 the hardest. Yet it passed 49 to 1 and now heads to the Montana House Business and Labor Committee for consideration.

The idea behind the bill is to make sure carriers cover original equipment manufacturer (OEM) repair procedures. The Legislature’s big concern is safety inspections after a vehicle collision.

Montana Sen. Barry Usher sponsored the bill and said this is especially critical when it comes to seat belts and airbags. Some insurers — he said — have resisted what he considers “essential” inspections.

While it forbids insurance companies from ordering shops to ignore OEM repair guidelines, it does not say they cannot recommend using alternative repair parts as long as the parts and practices coincide with OEM safety standards.

State Farm’s Greg Van Horssen said this is a bad idea.

“We have an obligation to return a car to its pre-accident condition, and we try to do that as cheaply and as reasonably as possible,” Van Horssen said. “Any time the cost of repair goes up, so does your insurance premiums, and you know what your insurance premiums are doing in the past five years or so.”

American Property Casualty Insurance Association legal representative, Aimee Grmoljez agrees. She says the bill is “vague” and will increase costs to consumers in a state with the third highest auto repair costs in the country.

Aimee Grmoljez, a legal representative for the American Property Casualty Insurance Association, accused the bill of being “vague,” and said it would increase costs for consumers in the state, which she claims has the third highest repair costs in the U.S. 

Van Horssen agrees the bill is quite vague.

“We do support and would support and do follow specific technical procedures but not position statements or general checklists or safety inspection checklists because they are general,” Van Horssen said. “They are in the manufacturer’s book. These are not repair procedures. They are suggestions, and we think this bill would require us to follow that, and we believe that it would result in an astronomical increase to your insurance premiums.”

Source link: Insurance Business America — https://bit.ly/3FjSCgh