There was a time when we had competition and a genuine free market in the U.S. Collision repairers have long complained that insurers dictate repair terms and pay a predetermined rate that is often significantly less than and unrelated to what the repair facility actually charges for its labor. Doctors and hospitals also complain that they are required to give insurance companies “discounts” and special low rates to prevent insurers from sending business to facilities and physicians who do concede to this economic pressure.
It seems ironic, then, to discover that insurers were being forced to provide kickbacks to large insurance brokers to have business driven to them. They obviously found that activity unacceptable, financially burdensome, and anti-competitive — and as the lawsuit filed by N.Y. Attorney General, Elliot Spitzer, demonstrates, insurers decided to do something about it.
The next clear question is: When can we expect insurers to act responsibly and lift their “discount” demands and start allowing collision repair shops and medical practitioners to earn a living wage?
Click here for the full text of the Spitzer v. Marsh & McLennan Companies, Inc., et al. complaint.
There was a time when we had competition and a genuine free market in the U.S. Collision repairers have long complained that insurers dictate repair terms and pay a predetermined rate that is often significantly less than and unrelated to what the repair facility actually charges for its labor. Doctors and hospitals also complain that they are required to give insurance companies “discounts” and special low rates to prevent insurers from sending business to facilities and physicians who do concede to this economic pressure.
It seems ironic, then, to discover that insurers were being forced to provide kickbacks to large insurance brokers to have business driven to them. They obviously found that activity unacceptable, financially burdensome, and anti-competitive — and as the lawsuit filed by N.Y. Attorney General, Elliot Spitzer, demonstrates, insurers decided to do something about it.
The next clear question is: When can we expect insurers to act responsibly and lift their “discount” demands and start allowing collision repair shops and medical practitioners to earn a living wage?
Click here for the full text of the Spitzer v. Marsh & McLennan Companies, Inc., et al. complaint.
You Can’t Recover Diminished Value If You Lease. Is That True? Of course not, but there are some enterprising claims representatives who will tell you that you can’t recover diminished value if you lease your car. I heard that assertion repeatedly from claims representatives in Ohio until I presented a continuing legal education seminar and included a copy of the Ohio statue recognizing that a lessee can recover all damage caused to a lease vehicle. I haven’t heard that argument from a claims agent in any state since. It is sometimes difficult to find existing statutes on off-beat topics because they seem to end up in the strangest places. The Ohio statute showed up in the Certificate of Title chapter, not anywhere in tort sections or propertly loss. Diminished Value and Leased Vehicles: Do Leased Cars Really Suffer Less from Collision Damage?
If you have been involved in a car accident, your right to be paid diminished value may depend on whether you were the at-fault driver or the person who was hit. Some U.S. state laws, like Georgia, allow both to recover diminished value payments. Other states allow insurers to exclude diminished value payments for their policyholders and this results in only the person who was not at fault being able to claim and recover the decreased value caused to the car. Diminished Value: First Parties v. Third Parties Posted
If you have been paying attention to the dualing class actions raging in the midwest, you have probably heard about something called “diminished value”. Unless you are involved in auto issues, you are probably thinking, “What the heck is that?” Here’s the answer. Diminished value is the phrase we use to describe the decrease in value your vehicle suffers from an adverse event — typically, when it has been involved in an accident. When people are thinking about buying a car, one of the important questions they have is, “Has this car ever been in an accident?” If the honest answer to that question is “yes”, the buyers may simply cross that car off the list or will only consider buying it at a much cheaper price. The bottom line is that after an accident, your car is almost always worth less than it was immediately before the crash.
Read more about this phenomenon: Understanding Diminished Value