NCOIL to Resume Consideration of Parts, Steering Acts
By Robert L. Redding Jr.
ASA Asks Repairers to Oppose Model Acts
The National Conference of Insurance Legislators (NCOIL) will soon continue its work on several collision repair issues at its annual meeting in Austin, Texas. The meeting will be held Nov. 18-21.
NCOIL's Property-Casualty Insurance Committee has under consideration both a Proposed Model Act Regarding Motor Vehicle Crash Parts and Repair, and a Proposed Model Act Regarding Insurer Auto Body Steering.
Following are some excerpts from a letter ASA's Washington representative, Robert L. Redding Jr., sent July 7, 2010, to Ruth Teichman, chairwoman of the National Conference of Insurance Legislator's (NCOIL) Property-Casualty Committee. To read the full letter, go to www.asashop.org/takingthehill where you will find listed "ASA Asks Repairers to Contact NCOIL Legislators." Look for "Click here to view the letter."
"... ASA opposes the current language in the Proposed Model Act Regarding Motor Vehicle Crash Parts and Repair ... ASA is concerned about ... aftermarket parts certification, the lack of a formal consumer-written consent process for the use of replacement crash parts, and certified parts equivalency to OEM ...
"... The history of aftermarket parts certification has not worked well for collision repairers or consumers. Current certification programs involved only a fraction of the aftermarket crash parts marketplace. Who is to certify parts? What state or federal regulatory agency will assure that certification entities are conducting themselves in a manner that adheres to policy goals and professional standards? Should there be a safety component to the certification process? The language falls short on the scope of the standards for certification ...
"... ASA supports state disclosure laws that require insurers and auto collision facilities to obtain the express written consent of vehicle owners before installing alternative replacement crash parts. ASA supports disclosure statements that alert consumers that the use of alternative crash parts other than those manufactured by the Original Equipment Manufacturer may have an effect on their warranty's market value ...
... ASA proposes that you limit the scope of the proposed Model Act to a formal consumer notice and written consent process applicable to any crash parts used in the repair, whether they are OEM, aftermarket, or salvage parts.
"ASA encourages the Committee to vote and defeat the Proposed Model Act Regarding Motor Vehicle Crash Parts and Repair."
Automotive Service Association (ASA) members and staff have participated in previous NCOIL meetings on both of these issues. ASA submitted comments in an effort to improve both proposals for collision repairers. Unless changes in the model acts occur, ASA will continue to oppose both initiatives. The Property-Casualty Insurance Committee has not taken any action to date on either model act.
In 2009 at the Philadelphia NCOIL meeting, at the spring 2010 meeting in South Carolina and most recently at the summer meeting in Boston, ASA has continued to oppose both the parts and steering model acts as drafted. (See excerpts from ASA's most recent letter.)
Key concerns about the parts model act include:
• Aftermarket parts certification
• The lack of a formal consumer written consent process
• Certified parts equivalency to OEM parts
After conferring with ASA leaders from across the country, ASA has opted to work with committee members to try to get a final resolve for both issues at the November NCOIL meeting. ASA requests that members contact NCOIL Property-Casualty Insurance Committee members requesting that they make final decisions on these issues and if no substantive reforms of the model acts are agreed to, then both acts should be defeated.
The anti-steering provisions were originally combined with the parts proposal under the Proposed Model Act Regarding Motor Vehicle Crash Parts and Repair package.
In South Carolina, NCOIL pulled the anti-steering provisions out of the parts model act. Parts and anti-steering were considered separately in Boston and will again be separate in Austin.
ASA recognizes the profile parts certification has in the industry at this time. A parts certification Town Hall meeting titled "Is Certification the Best Aftermarket Parts Policy for Consumers and Repairers?" was held at NACE as part of Automotive Service and Repair Week in October. Panel participants included Bob Anderson, board member, Certified Aftermarket Parts Association; Charlie Hogarty, chairman, Automotive Body Parts Association; Paul Massie, powertrain and collision product marketing manager, Ford Motor Co.; Karen Fierst, KerenOr Consultants; Jim Smith, consultant, Diamond Standard; and Dan Stander, ASA's Collision Division director, who served as moderator of the parts certification panel discussion.
Much has changed in the parts certification debate since NCOIL began its model act review process. Without more collision repairer input, the current NCOIL model being considered by the Property-Casualty Insurance Committee will not include policy suggestions valuable to the future of the collision repair industry.
The attempt to address steering in the most recent model act also falls short. ASA has made the committee aware that its efforts, although they may be well-intended, could harm the collision repair industry without additional input.
ASA has placed information about these model acts, NCOIL contact information and a pre-written letter for collision repairers to send NCOIL Property-Casualty Insurance Committee members on its legislative website, www.Taking theHill.com. ASA encourages collision repairers to go to the website and send comments opposing both the Proposed Model Act Regarding Motor Vehicle Crash Parts and Repair, and the Proposed Model Act Regarding Insurer Auto Body Steering.
Taking the Hill
DOT, EPA Looking at Fuel Economy,
Greenhouse Gas Emissions
The U.S. Department of Transportation's (DOT) National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA) recently issued a Notice of Intent (NOI) regarding fuel economy and greenhouse gas emissions standards for cars and small trucks to be manufactured between the years 2017 and 2025. The EPA claims the initiative will help make it possible for manufacturers to build a single national fleet of cars and light trucks that satisfies all federal and California standards, while ensuring that consumers have a full range of vehicle choices.
NHTSA, EPA and the California Air Resources Board (CARB) made an interim technical assessment that describes different potential outcomes. The assessment - developed through extensive dialogue with automobile manufacturers and suppliers, nongovernmental organizations, state and local governments and labor unions - takes into consideration the costs and effectiveness of applicable technologies, compliance flexibilities available to manufacturers, potential impacts on auto industry jobs and the infrastructure needed to support advanced technology vehicles. The EPA and DOT state in the technical assessment they will issue an interim report in November, with further details regarding the new fuel economy standards for vehicles manufactured in 2017 and later.
The final rule for the intended standards is scheduled for almost two years from now. - Philip Thompson
Governor Vetoes California Airbag Fraud Bill
California Gov. Arnold Schwarzenegger has vetoed Senate Bill 427.
The legislation, proposed by California state Sen. Negrete McLeod, D-Chino, had been introduced to crack down on airbag fraud.
The bill included language that condemns perpetrators of airbag fraud, stating that those who "fail to repair and fully restore the airbag to original operating condition where the customer has paid for the airbag repair as provided in the estimate" can receive up to a $5,000 fine and up to a year in prison.
The language of the bill also included restrictions for invoices, including the following requirements:
• All work done by an automotive repair dealer, including all warranty work, must be recorded on an invoice and must describe all service work done, parts supplied and crash parts installed.
• Service work and parts must be listed separately on the repair invoice, which must also state separately the subtotal prices for service work and for parts, not including sales tax, and must state separately the sales tax, if any, applicable to each.
• If any used, rebuilt or reconditioned parts are installed, the invoice must clearly state that fact.
• If a part of a component system is composed of new and used, rebuilt or reconditioned parts, that invoice must clearly state that fact.
• The invoice must include a statement indicating whether any crash parts are original equipment manufacturer (OEM) crash parts or non-OEM aftermarket crash parts.
• One copy of the invoice must be given to the customer, and one copy must be retained by the automotive repair dealer. - Kaitlyn Dwyer
Bob Redding is the Automotive Service Association's Washington, D.C., representative. He is a member of several federal and state advisory committees involved in the automotive industry.
For more information about the legislative activities of ASA, visit www.TakingTheHill.com.
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