Auto Body Shops: Insurance Companies Force Shoddy Repairs

February 24, 2015

Ellis Law Corporation

Personal Injury

Hundreds of auto body shops across the country, as well as states like Louisiana, Mississippi, and Oklahoma, are taking legal action against insurance companies that allegedly coerce them into using discarded parts and questionable techniques in car repairs. Auto repair shop owners say that insurance companies will steer customers away from shops that don’t follow these shoddy repair practices. Legal advocates fear that an outsized concern with the bottom line encourages makeshift fixes that compromise safety and the problem may be so widespread that the Department of Justice has been asked to investigate.

Ellis Injury Law finds these practices discouraging; obviously insurance companies and repair shops should be working together to put the safety of customers first. We hope that these practices are being stopped before anyone is seriously injured. However, if you believe that you have suffered harm or property damage due to an insurance company-mandated repair that entailed the use of broken parts, it is clear that the company in question should be held accountable for these unethical and illegal dealings.

An auto repair fraud lawsuit may be the way to go in such a case.

Allegations of repairs with broken parts

A CNN report describes the kinds of questionable practices that might merit an auto repair scam lawsuit. One example comes from a shop in Monroe, Louisiana, in which the shop owner unwrapped a Toyota Tacoma headlight that he was supposed to use as a replacement during repairs. The headlight was damaged and had a hole; it had been screwed and glued back together and wrapped up to be reused. The owner explained that the headlight would likely fill up with water the first time it rains because of the crack in the lens. Other sources describe the use of dented and damaged parts, or parts intended for cars of another make or model jury-rigged into place.

Shop owners say that insurance companies routinely compile lists of “preferred” businesses, where repairs can be made quickly and cheaply, but also using bad quality parts that compromise safety. Shops have complied in the past because they fear losing business.

But now they are fighting back in a large scale legal battle. In addition to auto body shops, individual customers who have suffered harm or damage due to such practices may also be eligible for a lawsuit against the insurance companies.

Insurance companies dispute claims concerning auto repair fraud

State Farm, one of the largest insurers, and a company involved in the legal dispute, says that such practices are not standard. Representative Neil Alldredge, of the National Association of Mutual Insurance Companies (whom State Farm suggested CNN should ask about the allegations) said that “It is just not in the economic interest of the insurer to have a car go in and out of an auto body shop three or four times to get it right … And so the notion that somehow this is meant to … do shoddy work or to encourage the idea that we have to get it done quickly and move on to the next one really isn’t in the insurance company’s economic interest.” He declined to comment about the example of the broken headlight.

More details about the insurance companies’ involvement in such practices will no doubt become clearer as the legal proceedings continue. But to the extent that practices have had an impact on individual drivers, L.A. auto repair customers should speak to a Los Angeles personal injury attorney at Ellis Injury Law about their legal options.

If you have questions about filing a Los Angeles auto repair fraud lawsuit, please contact us at 310-641-3335 to set up a no-cost, no-obligation consultation.