Well, it just wouldn’t be the holiday season unless we got more of those professional faxes from our friends in Columbus. The spirit of the Grinch is alive indeed. This time it is another pricing structure advisory from the “National Glass Program” on behalf of another insurer. And naturally, the prices contained herein are not the “lowest available” to the insurer. No, they may not be, but, in my opinion, are just low enough to encourage the use of substandard glass and substandard installation procedures.
The notice goes on to advise that, “Our policyholders have the right of personal choice and preference in their selection of an automotive glass shop.” Is that really accurate? In my opinion, there is not a shop among us that does not participate in this network that is not familiar with the tactics that are used by this particular network. And labeling it harassment would be too complimentary.
This advisory, which once again lacks any hint of professionalism, proclaims that the insurer represented “does not consent to any assignment of proceeds of glass claims.” Excuse me, but Mr. Columbus Network, does not every single dispatch that you forward to the shop require our customer to sign your acknowledgement? Perhaps a little refresher is necessary.
“I authorize my insurance, fleet, or leasing company to pay XXXXXXX directly for this claim.” Isn’t that an assignment of proceeds? Is it instructing the glass shop that they better collect upfront, to make certain that they get paid? Or is this another modification intended purely to promote the best interests of the network/insurance company thereby shortchanging the policyholder? Believe me, I would much rather have my customer pay our shop for its services directly and have the insurance company reimburse its customer, the way it should be.
I have to admit, for a publicly traded company and the continued lack of professionalism, you sure keep me laughing like my stomach is a bowl full of jelly. A jolly old elf, indeed.
Monday, December 21, 2009
Tuesday, December 8, 2009
New Policy?
Just as I was ready to leave the office the other night, one of those infamous faxes was coming over the fax machine—you know, the one that originates in the Midwest with no corporate letterhead, but appears to be an "official" policy statement from an insurance company. Its contents were the same nonsense that usually comes on any fax that originates out of this Midwestern call center and said something to the effect that if you start to repair a vehicle without the insured or the agent officially reporting the claim to the network, you will not get paid. If you haven't had the opportunity to read this "official" policy statement, please take the time to do so. After you are able to contain your laughter, try to decipher what the underlying motive might be.
You first might begin by asking yourself, are these people for real? Is this what you would expect from an "official" policy statement released by a major insurance company?
Since this document lacks any hint of professionalism, would anyone accept that this is an "official" document originating from the insurance company? An insurance company surely has the right to require any procedure to insure compliance with the product it sells, but issue the directive to the policyholder. After all, you have no business relationship with the shop.
Now, let's use some reasoning and see if we can dissect the real motive here. I believe that the TPA behind forwarding this fax has really stepped up its poaching of claims. You do not need to look too far—there are examples all over the Internet. Just the other day, we had two customers who were called back on at least two attempts to sway them to use the services of another shop. And guess what shop? I ask you Mr. CEO, is this educating the customer like the insurance companies supposedly ask you to do? I ask you Mr. CEO, in light of your company’s proclamation that so few policyholders have a shop in mind when they call in the first notice of loss, why two and three follow-up calls in an attempt to get them to change their minds after they insist on our shops? I ask you, Mr. CEO, why must your company do this when you have publicly proclaimed that your company is not our competition?
So just what is the real reason behind this document? Sorry, time is up. This procedural bulletin is nothing more than an opportunity to steal more of our business. If you haven't performed or started the work, guess what? They have more time on the clock to "educate" the customer. But in my humble opinion, I would rather replace the phrase "educate" with harass. After all, does it make any sense? If our customer has the glass addendum on their policy, they have the right to choose the service provider of their choice—a right protected by laws in many of the fifty states. Technically, all that our customer is doing is using a product, insurance, that they purchased for this very purpose—to indemnify them in the case of an accident. Mr. TPA, I assure you. One way or another we will get paid for our services.
And another thought. Now that we have dispelled the proclamation that "we are not your competition" as nonsense, I challenge you to compete with the independent shops fairly, and let us see who ultimately earns more business. Many independents are giving you more, quality glass and installs according to standards. Unfortunately, independents shops do not have the luxury of an "average guaranteed invoice."
You first might begin by asking yourself, are these people for real? Is this what you would expect from an "official" policy statement released by a major insurance company?
Since this document lacks any hint of professionalism, would anyone accept that this is an "official" document originating from the insurance company? An insurance company surely has the right to require any procedure to insure compliance with the product it sells, but issue the directive to the policyholder. After all, you have no business relationship with the shop.
Now, let's use some reasoning and see if we can dissect the real motive here. I believe that the TPA behind forwarding this fax has really stepped up its poaching of claims. You do not need to look too far—there are examples all over the Internet. Just the other day, we had two customers who were called back on at least two attempts to sway them to use the services of another shop. And guess what shop? I ask you Mr. CEO, is this educating the customer like the insurance companies supposedly ask you to do? I ask you Mr. CEO, in light of your company’s proclamation that so few policyholders have a shop in mind when they call in the first notice of loss, why two and three follow-up calls in an attempt to get them to change their minds after they insist on our shops? I ask you, Mr. CEO, why must your company do this when you have publicly proclaimed that your company is not our competition?
So just what is the real reason behind this document? Sorry, time is up. This procedural bulletin is nothing more than an opportunity to steal more of our business. If you haven't performed or started the work, guess what? They have more time on the clock to "educate" the customer. But in my humble opinion, I would rather replace the phrase "educate" with harass. After all, does it make any sense? If our customer has the glass addendum on their policy, they have the right to choose the service provider of their choice—a right protected by laws in many of the fifty states. Technically, all that our customer is doing is using a product, insurance, that they purchased for this very purpose—to indemnify them in the case of an accident. Mr. TPA, I assure you. One way or another we will get paid for our services.
And another thought. Now that we have dispelled the proclamation that "we are not your competition" as nonsense, I challenge you to compete with the independent shops fairly, and let us see who ultimately earns more business. Many independents are giving you more, quality glass and installs according to standards. Unfortunately, independents shops do not have the luxury of an "average guaranteed invoice."
Monday, November 16, 2009
Competitive Pricing?
Recently, in response to a request for a short payment that I had initiated, the insurance company representative responded that the company already pays a “competitive price” for auto glass replacement and could not justify paying any more. I thought to myself, “Interesting, the insurer pays a competitive price.”
But just what is that “competitive price” to which he refers and how is it determined? Does “competitive price” mean paying the lowest price for “like kind and quality?” In other words, there is no apparent difference in the quality of the glass and the level of service provided by Shop A and Shop B, but Shop A charges less, so Shop A has set the “competitive price.” Well, I guess I could swallow that as being reasonable. But we certainly know this not to be the case.
And then another question comes to mind: why is the “competitive price” established by this particular insurance company so much less than the “competitive price” established by other companies? Are they operating within a different marketplace? Do they use different variables in calculating this “competitive price?” Throw standardized pricing and standardized labor hours for each job into this mix. Does a certain percentage off a list price allow us to conclude that there is any industry confidence in the established list price? Does a certain figure per labor hour allow us to conclude that there is any confidence in the book times established for each installation? All valid questions, don’t you agree?
On November 3, glassBYTEs reported that a shop’s AGRSS registration absolved it for removing a windshield and not reinstalling a new one because it would not be safe to do so. The article reported that the windshield that was removed was installed with bathtub caulking. Imagine that, installed with bathtub caulk. And if this was an insurance job, just how much do you think this shop was paid? Without a doubt, and let’s say it together, the prevailing “COMPETITIVE PRICE.” So it was not only a creative install, but in the eyes of the insurance company, a competitive install. I will go one step further and bet that this shop has its own certification program and is subject to self audit.
Folks, let’s get real. This is not an isolated incident. This happens frequently. However, we operate in an industry that is loosely regulated and subjected to arbitrary numbers. Include in this equation third-party administrators with major conflicts and we get shops that install windshields with bathtub caulk.
So I feel it is my professional responsibility to offer a solution. In my estimation, we need tiered pricing. First, we should have a “competitive price.” And then we should have a “creative price.” I think we can all agree that at the very least, insurers should not be paying a competitive price to shops using bathtub caulk. A shop using bathtub caulk should be paid a “creative price.” After all, the standardized price on bathtub caulk should be less than urethane, allowing insurance companies to pad their bottom lines even more.
But just what is that “competitive price” to which he refers and how is it determined? Does “competitive price” mean paying the lowest price for “like kind and quality?” In other words, there is no apparent difference in the quality of the glass and the level of service provided by Shop A and Shop B, but Shop A charges less, so Shop A has set the “competitive price.” Well, I guess I could swallow that as being reasonable. But we certainly know this not to be the case.
And then another question comes to mind: why is the “competitive price” established by this particular insurance company so much less than the “competitive price” established by other companies? Are they operating within a different marketplace? Do they use different variables in calculating this “competitive price?” Throw standardized pricing and standardized labor hours for each job into this mix. Does a certain percentage off a list price allow us to conclude that there is any industry confidence in the established list price? Does a certain figure per labor hour allow us to conclude that there is any confidence in the book times established for each installation? All valid questions, don’t you agree?
On November 3, glassBYTEs reported that a shop’s AGRSS registration absolved it for removing a windshield and not reinstalling a new one because it would not be safe to do so. The article reported that the windshield that was removed was installed with bathtub caulking. Imagine that, installed with bathtub caulk. And if this was an insurance job, just how much do you think this shop was paid? Without a doubt, and let’s say it together, the prevailing “COMPETITIVE PRICE.” So it was not only a creative install, but in the eyes of the insurance company, a competitive install. I will go one step further and bet that this shop has its own certification program and is subject to self audit.
Folks, let’s get real. This is not an isolated incident. This happens frequently. However, we operate in an industry that is loosely regulated and subjected to arbitrary numbers. Include in this equation third-party administrators with major conflicts and we get shops that install windshields with bathtub caulk.
So I feel it is my professional responsibility to offer a solution. In my estimation, we need tiered pricing. First, we should have a “competitive price.” And then we should have a “creative price.” I think we can all agree that at the very least, insurers should not be paying a competitive price to shops using bathtub caulk. A shop using bathtub caulk should be paid a “creative price.” After all, the standardized price on bathtub caulk should be less than urethane, allowing insurance companies to pad their bottom lines even more.
Wednesday, October 28, 2009
It Doesn't Get Any Better Than This
I was overcome with emotion when the “good hands people” notified our shop that we had attained “Distinguished Performer” status. With tears of joy streaming down my face, I continued to read on that with all the glass shops out there, we have been elevated. The hard work of our technicians, support staff and commitment to customer service was finally paying off. To the “good hands people” we were now ranked with the best of the best. And like they say in that well known beer commercial, “It doesn’t get any better than this.”
I had to re-read the short e-mail, received by our company’s president, because it was almost too good to be true. I have never considered myself to be a skeptic, but given the nature of the auto glass industry, an insurance company just doesn’t congratulate you without a hitch. It just doesn’t happen. So I reread the email and guess what? I was right, there was a catch. Imagine that. Not only were we now considered among the best, but on the date that we would be formally recognized as the best, we would have to continue to outperform, for less money. You just can’t beat that. And to top it off, there was no action required on our part. The transition to this “elite” status would be seamless.
In all honesty, we didn’t even have to think twice. Without hesitation, we will be cooperative and take care of our mutual customer, making you look good while you enhance your bottom line and we can sacrifice ours. It would be an honor. After all, these opportunities do not come by everyday. We wouldn’t think of using inferior glass or compromising our service. After all, we aren’t in business to make money. Rather, we are in business to serve the insurance companies. Who wouldn’t jump at that chance? Actually, we thrive on the challenge. Watch our profit margins erode and see how long we can stay in business.
To the executives at the helm and those with the creativity to develop these generous programs, I hope that you will take the time out of your hectic schedules, when your bonus checks are distributed, to take a moment and reflect. And maybe, just maybe, please consider sending out another congratulatory note, including thanks, to those of us who are most grateful that you had the dignity to throw us a few crumbs from the table.
I had to re-read the short e-mail, received by our company’s president, because it was almost too good to be true. I have never considered myself to be a skeptic, but given the nature of the auto glass industry, an insurance company just doesn’t congratulate you without a hitch. It just doesn’t happen. So I reread the email and guess what? I was right, there was a catch. Imagine that. Not only were we now considered among the best, but on the date that we would be formally recognized as the best, we would have to continue to outperform, for less money. You just can’t beat that. And to top it off, there was no action required on our part. The transition to this “elite” status would be seamless.
In all honesty, we didn’t even have to think twice. Without hesitation, we will be cooperative and take care of our mutual customer, making you look good while you enhance your bottom line and we can sacrifice ours. It would be an honor. After all, these opportunities do not come by everyday. We wouldn’t think of using inferior glass or compromising our service. After all, we aren’t in business to make money. Rather, we are in business to serve the insurance companies. Who wouldn’t jump at that chance? Actually, we thrive on the challenge. Watch our profit margins erode and see how long we can stay in business.
To the executives at the helm and those with the creativity to develop these generous programs, I hope that you will take the time out of your hectic schedules, when your bonus checks are distributed, to take a moment and reflect. And maybe, just maybe, please consider sending out another congratulatory note, including thanks, to those of us who are most grateful that you had the dignity to throw us a few crumbs from the table.
Friday, October 9, 2009
Repair Awareness
Friday afternoon, I took the afternoon off for some R and R. I was lounging by my pool and I fell asleep. While napping I had a very unusual dream.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
Tuesday, September 8, 2009
It's About Time
Friday afternoon, I took the afternoon off for some R and R. I was lounging by my pool and I fell asleep. While napping I had a very unusual dream.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
Tuesday, August 18, 2009
An Unusual Dream
Friday afternoon, I took the afternoon off for some R and R. I was lounging by my pool and I fell asleep. While napping I had a very unusual dream.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
I dreamt that after the Obama administration passed its healthcare legislation, the President decided that he wanted every citizen that was of legal driving age to own an automobile. Of course, it had to get the required mileage, etc. In addition, he wanted every automobile to be covered by insurance that included comprehensive coverage with an auto glass endorsement and no deductible.
There would be no restrictions such as pricing caps, etc. You would have the freedom to have your vehicle serviced by any collision or auto glass shop that you desired. What was very interesting was that unlike the healthcare policies that covered the President and members of the Congress, the very people that would pass this legislation wanted the ability to opt out and be able to subscribe to the same policy offered to the general public at large. You see, they were on some policy underwritten by some company whose ad prop was a green lizard type and they wanted to have the ability to have their auto glass replaced by a quality shop, using quality materials and employing quality technicians.
They did not want to be subjected to harassment by some third-party when calling in their claims. They simply wanted the freedom to have their cars serviced where they could trust that the job would be done correctly and safely. What was ironic was that everyone who attended the town hall meetings held by their representatives were adamant about having this program enacted. They actually wanted the government to legislate this new program. There was no concern for the cost of the program or the fact that the government would be involved.
People were tired about having to listen to some customer service representative for 20 minutes trying to talk them into taking their car to some box store styled repair and replacement shop. They were exhausted after simply trying to make an appointment with a shop of their choosing and getting railroaded by some individual located at some call center in the Midwest.
Well, after months of debate and public outcry, the bill was finally reconciled in a joint committee of both houses and the day finally came for it to come up for a vote. A short time after the voting began, I woke up after being licked across the face by my 140-pound black lab, Otis. Unfortunately, we will never know how the vote would turn out.
What a dream. In the course of a short, eventful half-hour snooze, the ills of the automotive glass repair and replacement industry were almost fixed. Back to the nightmare.
Tuesday, August 4, 2009
Winds of Change
Are the winds of change blowing through the United States Department of Justice (DOJ)? Is the Obama Administration concerned with fair and free competition and therefore in pursuit of corporations that are not playing within the rules? A recent article by the New York Times News sure makes it sound that way. In particular, the article introduces the readers to the top official of the antitrust division at the DOJ, Christine A. Varney (a Syracuse native, I might add). The article notes that the administration is determined to reign in several industries, including airlines, railroad and pharmaceuticals.
The administration’s stance differs from that of the previous administration in that the current spin is that domination hurts consumers. To the contrary, the article supports that the Bush Administration held the position that larger corporations would benefit consumers due to economies of scale. Having experienced the inner workings of the auto glass repair and replacement industry and hearing of similar circumstances in the auto body repair industry, it is my hope that a slide of these industries will be prepared for the microscope. When an insurance claim is introduced into the process, small business operators in either of these industries can attest to the unfair practices and that steering truly does exist. You do not need to convince me that current practices in the auto glass industry restrict free and fair competition. And when competition is restrained, consumers are harmed. Consumers benefit when they are free to choose a service provider without conditions or undue influence. In the case of an insurance claim, we know that both factors are present. Consumers are harmed when something as critical as a properly installed windshield is to their safety is being installed by anyone who will “accept” the insurance company’s price. No other qualifications, just accept the price and the job is yours. And when two of the largest auto glass claims processors (i.e., third-party administrators) have major conflicts of interest, need I say more?
In a recent glassBYTEs.com™ video newscast, we viewed the newest addition to the Safelite distribution network. We are witnessing the “Walmart-ization” of the auto glass repair and replacement industry. Let me remind you that the replacement of a windshield is not, is not, a commodity. It is a service and a critical service indeed. And when that service involves the safety of consumers, we should all be ashamed of ourselves, regulators, insurance representatives and AGRR industry participants that we allow this scenario to continue to unfold. I commend the efforts of the various associations that are working feverishly to promote consumer safety through certification programs and installation standards. Free and fair competition must replace the present system in the AGRR industry. Consumers must be assured that their windshields are installed based on safety and not that their insurance company paid the lowest price for the claim.
The administration’s stance differs from that of the previous administration in that the current spin is that domination hurts consumers. To the contrary, the article supports that the Bush Administration held the position that larger corporations would benefit consumers due to economies of scale. Having experienced the inner workings of the auto glass repair and replacement industry and hearing of similar circumstances in the auto body repair industry, it is my hope that a slide of these industries will be prepared for the microscope. When an insurance claim is introduced into the process, small business operators in either of these industries can attest to the unfair practices and that steering truly does exist. You do not need to convince me that current practices in the auto glass industry restrict free and fair competition. And when competition is restrained, consumers are harmed. Consumers benefit when they are free to choose a service provider without conditions or undue influence. In the case of an insurance claim, we know that both factors are present. Consumers are harmed when something as critical as a properly installed windshield is to their safety is being installed by anyone who will “accept” the insurance company’s price. No other qualifications, just accept the price and the job is yours. And when two of the largest auto glass claims processors (i.e., third-party administrators) have major conflicts of interest, need I say more?
In a recent glassBYTEs.com™ video newscast, we viewed the newest addition to the Safelite distribution network. We are witnessing the “Walmart-ization” of the auto glass repair and replacement industry. Let me remind you that the replacement of a windshield is not, is not, a commodity. It is a service and a critical service indeed. And when that service involves the safety of consumers, we should all be ashamed of ourselves, regulators, insurance representatives and AGRR industry participants that we allow this scenario to continue to unfold. I commend the efforts of the various associations that are working feverishly to promote consumer safety through certification programs and installation standards. Free and fair competition must replace the present system in the AGRR industry. Consumers must be assured that their windshields are installed based on safety and not that their insurance company paid the lowest price for the claim.
Friday, July 17, 2009
Is Bigger Always Better?
In a recent blog, our friend Neil Duffy wrote about the entrepreneurial spirit and how independents must strive to maintain that spirit. I could not agree more. In this age of Super Wal-Marts and bigger is better, is bigger always in the best interests of the consuming public? When the commerce is a commodity, this concept may be acceptable. But when the commerce involves a service, it is not. Auto glass repair and replacement is a service, so the industry is certainly on the wrong track. And the consumer is surely a loser.
Competition is less, choice is stifled and public safety can be compromised. The “how low do you go?” mentality in the AGRR industry is prevalent. But any independent that has served this industry for any length of time knows better. And quality independents know that the product offered is not a commodity; rather it is a service. And many take pride in the service that they provide to their customers and the quality of glass they install.
The other day, someone posted a link to the ABC 20/20 report about the importance of proper and safe windshield installation, which originally aired many years ago, on the glassBYTEs.com™/AGRR Forum. After viewing that video, I took the time to reflect and I could not help but conclude that the macro atmosphere within the AGRR industry undermines the safe and proper installation of windshields, breeding exactly what we witness in this ABC production. Unfortunately, this report portrays the reality in our industry and I believe that the installers that were featured in this exclusive represent the majority of the laborers serving this industry rather than the minority. It is amazing how that report still portrays our industry today, some several years later. However, there are people in the industry that are working feverishly to change it for the better.
We independents are operating in an industry where the primary focus is on price, one size fits all, and when compared, an apple is the same as an orange. It doesn’t matter that the pinchweld is rusted and may require additional labor or the fact that the replacement windshield should not be installed at all. (How many of you refuse to do an install when you know that it would not be safe to do so?) It doesn’t matter that installers follow proper procedures. It doesn’t matter that the independent shop only employs certified technicians or subscribes to the AGRSS Standard. So why do we bother to go the extra mile to take care of our customers? Does it make sense? Why don’t we all become hacks, cut corners and make more profits? After all, if Hackits Auto Glass can do it, why can’t we? The answer is that many of us are true professionals and will not compromise our integrity or compromise the safety of our customers.
So put it all together, mix in all of the major issues confronting the auto glass repair and replacement industry, such as steering, unlicensed claims adjusters, improperly trained techs, pricing pressure and inferior glass and you have a recipe for disaster. The certification of technicians and a comprehensive standards program like AGRSS are definitely a step in the right direction. I believe that injuries related to improper and unsafe windshield installation, like the two included in the 20/20 report, are more common than reported. Just how did the AGRR industry, a serviced-based industry, make the transition to a commodity-based industry? And when you take into consideration that all of the major players in our industry are fully aware of the importance of the consumer safety issues at stake, these two incidents are two too many. Don’t you agree?
Competition is less, choice is stifled and public safety can be compromised. The “how low do you go?” mentality in the AGRR industry is prevalent. But any independent that has served this industry for any length of time knows better. And quality independents know that the product offered is not a commodity; rather it is a service. And many take pride in the service that they provide to their customers and the quality of glass they install.
The other day, someone posted a link to the ABC 20/20 report about the importance of proper and safe windshield installation, which originally aired many years ago, on the glassBYTEs.com™/AGRR Forum. After viewing that video, I took the time to reflect and I could not help but conclude that the macro atmosphere within the AGRR industry undermines the safe and proper installation of windshields, breeding exactly what we witness in this ABC production. Unfortunately, this report portrays the reality in our industry and I believe that the installers that were featured in this exclusive represent the majority of the laborers serving this industry rather than the minority. It is amazing how that report still portrays our industry today, some several years later. However, there are people in the industry that are working feverishly to change it for the better.
We independents are operating in an industry where the primary focus is on price, one size fits all, and when compared, an apple is the same as an orange. It doesn’t matter that the pinchweld is rusted and may require additional labor or the fact that the replacement windshield should not be installed at all. (How many of you refuse to do an install when you know that it would not be safe to do so?) It doesn’t matter that installers follow proper procedures. It doesn’t matter that the independent shop only employs certified technicians or subscribes to the AGRSS Standard. So why do we bother to go the extra mile to take care of our customers? Does it make sense? Why don’t we all become hacks, cut corners and make more profits? After all, if Hackits Auto Glass can do it, why can’t we? The answer is that many of us are true professionals and will not compromise our integrity or compromise the safety of our customers.
So put it all together, mix in all of the major issues confronting the auto glass repair and replacement industry, such as steering, unlicensed claims adjusters, improperly trained techs, pricing pressure and inferior glass and you have a recipe for disaster. The certification of technicians and a comprehensive standards program like AGRSS are definitely a step in the right direction. I believe that injuries related to improper and unsafe windshield installation, like the two included in the 20/20 report, are more common than reported. Just how did the AGRR industry, a serviced-based industry, make the transition to a commodity-based industry? And when you take into consideration that all of the major players in our industry are fully aware of the importance of the consumer safety issues at stake, these two incidents are two too many. Don’t you agree?
Thursday, July 2, 2009
Indemnification—Or Not?
You have just purchased an insurance policy, and saved 15 percent in fourteen minutes, twenty seconds. A new record beating the one previously held by a neanderthal. You leave the office and you feel great. Especially in current economic times, that 15 percent savings can be used to put gas in the tank of your late-model vehicle. After leaving the insurance agency, you enter the highway on your feel good ride home. Life is good, and your favorite tunes are blaring over your speakers. The sun is shining and you have more money in your pocket. And whack! A big stone just kicked up by the semi in front of you puts a crack in your windshield.
No problem. Your day is not totally ruined. You might be a little inconvenienced, but no worry. You have your new insurance policy and replacing the windshield is sure to be hassle free. After all, your new insurance company is known for its customer service. Pulling in the driveway, you decide to get your insurance card out of the glove box and call your new company to make the claim. You call the toll-free number on the back of the card and follow the instructions. After providing all of the claim information to the representative on the other end of the phone, you continue to advise the CSR that you want to take your car to Joe’s Auto Glass. Joe is the guy that you know that you can rely on to replace your windshield and do it right the first time.
Uh-oh, a snag. The CSR informs you that Joe’s Auto Glass is not on their “approved” list of auto glass repairers. “Joe’s isn’t what? Are you kidding me? You mean I cannot take my car to Joe? What’s with that?”
“Well, Joe doesn’t accept our rates and Joe doesn’t offer a lifetime warranty. However, I can refer you to a shop where I can assure you that the technicians do not abuse alcohol or illegal drugs. That’s right, we drug-test all of our technicians. And our shops do it for free, that’s right free!” says the CSR.
But I know I can rely on Joe. He’s been serving our community since 1945 and I have never heard of any problems with his work. He is an outstanding member of the Better Business Bureau.
I say, “No, that’s okay, I still would like to take my car to Joe. He’s the guy I want to do the work.”
The CSR replies, “You know if you do, there is a good chance that you will incur some out-of-pocket expenses?”
What? I do not believe that is what I purchased. I did not purchase “partial” insurance. You mean now I need gap insurance? I thought when I bought this policy, my car would be restored to pre-loss condition. That it would be just like it was before the stone hit the windshield. I guess I was duped. The sales rep never told me that there could be restrictions when I go to make a claim. So much for saving 15 percent. I guess it is a buyer-beware situation.
This scenario plays out everyday in every state, every city and every town. Just what are consumers buying when they purchase an automobile insurance policy? I have always known automobile insurance policies to be indemnification policies. According to Webster, to indemnify means to “secure against hurt, loss or damage.” How about diminished value? If the quality of the glass or service is based purely on price, is a policyholder assured that the vehicle is restored to pre-loss condition? I do not think so. Do you?
No problem. Your day is not totally ruined. You might be a little inconvenienced, but no worry. You have your new insurance policy and replacing the windshield is sure to be hassle free. After all, your new insurance company is known for its customer service. Pulling in the driveway, you decide to get your insurance card out of the glove box and call your new company to make the claim. You call the toll-free number on the back of the card and follow the instructions. After providing all of the claim information to the representative on the other end of the phone, you continue to advise the CSR that you want to take your car to Joe’s Auto Glass. Joe is the guy that you know that you can rely on to replace your windshield and do it right the first time.
Uh-oh, a snag. The CSR informs you that Joe’s Auto Glass is not on their “approved” list of auto glass repairers. “Joe’s isn’t what? Are you kidding me? You mean I cannot take my car to Joe? What’s with that?”
“Well, Joe doesn’t accept our rates and Joe doesn’t offer a lifetime warranty. However, I can refer you to a shop where I can assure you that the technicians do not abuse alcohol or illegal drugs. That’s right, we drug-test all of our technicians. And our shops do it for free, that’s right free!” says the CSR.
But I know I can rely on Joe. He’s been serving our community since 1945 and I have never heard of any problems with his work. He is an outstanding member of the Better Business Bureau.
I say, “No, that’s okay, I still would like to take my car to Joe. He’s the guy I want to do the work.”
The CSR replies, “You know if you do, there is a good chance that you will incur some out-of-pocket expenses?”
What? I do not believe that is what I purchased. I did not purchase “partial” insurance. You mean now I need gap insurance? I thought when I bought this policy, my car would be restored to pre-loss condition. That it would be just like it was before the stone hit the windshield. I guess I was duped. The sales rep never told me that there could be restrictions when I go to make a claim. So much for saving 15 percent. I guess it is a buyer-beware situation.
This scenario plays out everyday in every state, every city and every town. Just what are consumers buying when they purchase an automobile insurance policy? I have always known automobile insurance policies to be indemnification policies. According to Webster, to indemnify means to “secure against hurt, loss or damage.” How about diminished value? If the quality of the glass or service is based purely on price, is a policyholder assured that the vehicle is restored to pre-loss condition? I do not think so. Do you?
Tuesday, June 23, 2009
A Real Learning Experience
Over the last couple of months, I have been an active participant on the glassBYTEs.com™/AGRR magazine forum and it has been an eye opener, to say the least. I have come to the realization that there are a lot of diverse views about the AGRR industry, and on many issues it will be best if we agree to disagree.
One topic about which I’m passionate is the subject of third-party administrators (TPAs) and the damage that their presence has done to our industry and the ability of each and every one of us to compete on a level playing field. I cannot tell you how many message board participants have suggested that many independent glass shops are failing because they are not using the proper business model; that they should disregard the presence of the networks and “work around” them. Then there are some that use the recurring theme “Who is the Customer?” and insist that they are in complete control of their customers. I have been told that I exert too much emphasis on the TPAs and have been labeled as stupid, uninformed and even naïve. Thus far, the criticisms have not pierced my skin and having had the opportunity to be a player in this industry for the past ten years, I do not believe that they ever will. What currently is going on in our industry may be the exception, but it must not remain the rule. I think that the majority of us believe that what is going on is anti-competitive and wrong. And, in my opinion, it certainly cannot be free speech.
While I continue to read on and reply, what troubles me is that there are shop owners that believe their businesses operate exclusive of TPA influence. And, to them I say, “nonsense.” There is no business model out there that is not impacted by the TPA presence in our industry. I do not care if your business is running on a purely cash basis. As long as your customers have insurance policies with the glass addendum, you are affected, one way or another. Although the insurance influence may only happen on occasion, you are not in total—let me reiterate: total—control of your business. If it only affects one customer, I argue, it affects your business.
Let me expand on this thought. Let’s assume that you do not bill insurance companies directly and are trying to operate a purely cash business and the phone rings. On the other end of the line, you hear, “I have a customer on the line that would like to use your shop.” How many of these types of calls have you received? This is a potential customer whose business is in jeopardy, and should not be.
My posts have been met with legal-based challenges, referring to court cases around this great land of ours. I have even witnessed the defense of actions by third-party administrators in the name of free speech. I have been challenged because I may not have read all these court cases. While I take every comment under consideration, I cannot help myself in thinking that we all know what is taking place in the auto glass repair and replacement industry is not fair.
The third-party administration model that affects each and every one of our businesses, in some respects dramatically, has transformed our industry. As shops operating in this industry, we no longer compete on our merits. Businesses have failed and are struggling, perhaps due to no fault of their own. Our services are treated like a commodity and it does not matter what kind of glass we install or the procedures adhered to by our techs. And even in the commodity world there are differences in the price that is charged; consider a store brand versus a national brand.
To everyone associated with this industry and maybe even fighting for survival, I say, fight on. Justice will ultimately prevail. Forums like the glassBYTEs/AGRR Forum give each and every one of us the opportunity to discuss issues that we all confront on a daily basis. And these discussion boards can offer a valuable source for technical assistance. They can serve a good purpose and I can offer that the discussions here truly invigorate me. How about you?
One topic about which I’m passionate is the subject of third-party administrators (TPAs) and the damage that their presence has done to our industry and the ability of each and every one of us to compete on a level playing field. I cannot tell you how many message board participants have suggested that many independent glass shops are failing because they are not using the proper business model; that they should disregard the presence of the networks and “work around” them. Then there are some that use the recurring theme “Who is the Customer?” and insist that they are in complete control of their customers. I have been told that I exert too much emphasis on the TPAs and have been labeled as stupid, uninformed and even naïve. Thus far, the criticisms have not pierced my skin and having had the opportunity to be a player in this industry for the past ten years, I do not believe that they ever will. What currently is going on in our industry may be the exception, but it must not remain the rule. I think that the majority of us believe that what is going on is anti-competitive and wrong. And, in my opinion, it certainly cannot be free speech.
While I continue to read on and reply, what troubles me is that there are shop owners that believe their businesses operate exclusive of TPA influence. And, to them I say, “nonsense.” There is no business model out there that is not impacted by the TPA presence in our industry. I do not care if your business is running on a purely cash basis. As long as your customers have insurance policies with the glass addendum, you are affected, one way or another. Although the insurance influence may only happen on occasion, you are not in total—let me reiterate: total—control of your business. If it only affects one customer, I argue, it affects your business.
Let me expand on this thought. Let’s assume that you do not bill insurance companies directly and are trying to operate a purely cash business and the phone rings. On the other end of the line, you hear, “I have a customer on the line that would like to use your shop.” How many of these types of calls have you received? This is a potential customer whose business is in jeopardy, and should not be.
My posts have been met with legal-based challenges, referring to court cases around this great land of ours. I have even witnessed the defense of actions by third-party administrators in the name of free speech. I have been challenged because I may not have read all these court cases. While I take every comment under consideration, I cannot help myself in thinking that we all know what is taking place in the auto glass repair and replacement industry is not fair.
The third-party administration model that affects each and every one of our businesses, in some respects dramatically, has transformed our industry. As shops operating in this industry, we no longer compete on our merits. Businesses have failed and are struggling, perhaps due to no fault of their own. Our services are treated like a commodity and it does not matter what kind of glass we install or the procedures adhered to by our techs. And even in the commodity world there are differences in the price that is charged; consider a store brand versus a national brand.
To everyone associated with this industry and maybe even fighting for survival, I say, fight on. Justice will ultimately prevail. Forums like the glassBYTEs/AGRR Forum give each and every one of us the opportunity to discuss issues that we all confront on a daily basis. And these discussion boards can offer a valuable source for technical assistance. They can serve a good purpose and I can offer that the discussions here truly invigorate me. How about you?
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