Glass Shop Launch Petition Drive for Choice Freedom of Choice 10/14/99

Auto Repair Shops Want Law to Prohibit Insurance Company Steering

Auto Glass Legal News
October 14, 1999

Farmington Hills, MI - A statewide petition drive has been launched seeking legislation to guarantee Michigan automobile owners the right to select auto glass repair shops of their choice without any steering by their insurance company. Steering is the process of diverting consumers to particular repair shops.

Thus far, some 38 states in the United States have anti-steering bills on the books or have issued guidelines banning steering practices. Michigan is one of the few which does not.

Attorney Jay Schwartz of Farmington Hills, who represents 48 auto glass repair shops throughout Michigan, said, "It would be in the best interests for the citizens of this state to have legislation which would prohibit insurance companies from steering consumers to specific facilities without the consumer being aware of the totality of the circumstances".

Petitions will be circulated throughout the state. Its preamble simply provides that Michigan citizens should "be able to freely use the automobile glass repair facility of their choice."

The petition asks the Michigan Legislature to enact a law which would guarantee that insurance companies license to operate in Michigan, or their agents:

Shall not restrict policyholders' access to auto glass repair or replacement facilities. Shall not require that automobile glass repair or replacement work be performed by a particular facility, individual or business as a condition of paying a claim. Must disclose to policyholders that they have the right to choose a glass shop of their choice. May not intimidate, coerce, threaten or in any way try to divert or steer claimants to a particular shop. Must promptly provide payment to the facility based on a fair and reasonable market value (one that is applied to all glass shops). In an ironic twist, Minnesota-based Harmon AutoGlass has specifically cited the lack of a Michigan law in this area to assist it in a lawsuit pending in Wayne County Circuit Court. The lawsuit involves a challenge by numerous Michigan auto glass repair shops and two Michigan consumers to an agreement between AAA and Harmon. In exchange for operating AAA's call center and rendering other services, AAA gave Harmon the right to refer a specific percentage of AAA vehicle glass repair or replacement claims to its own (Harmon AutoGlass) shops. In a court document, Harmon claims:

"While over 30 States have adopted statutes that allow insureds a right to choose the glass company that repairs or replaces the individual's auto glass, the State of Michigan has not enacted such a statute. Consequently, insurance companies operating in Michigan, including AAA Michigan, are not obligated by statute to provide a right to choose an automotive repair replacement shop to their insureds." The lawsuit seeks to halt deceptive trade practices and protect the consumer's right of choice. According to the lawsuit, when a consumer calls AAA with a glass claim, the call center routinely recommends Harmon AutoGlass as the repair shop to be used. The call center representative does not inform the caller that they are a Harmon employee. Media outlets in the state, including one investigative reporter who was actually recommended by the AAA/Harmon call center to one of Harmon's shops, have reported on this practice. Reporters and staff members from the Grosse Pointe News made numerous calls to the AAA/Harmon call center and were consistently referred to Harmon repair shops.

Petitions may be picked up at independent glass shops throughout Michigan or signed directly over the Internet by going to the website www.glasschoice.com.

Press Release Contacts:
Jay Schwartz, Schwartz Law Firm
Phone: 248-553-9400