ASA, ASC-MI Testify at Michigan Senate Insurance Committee Hearing on Insurer-Owned Repair Shops

The Automotive Service Association (ASA) and the Automotive Service Councils of Michigan (ASC-MI) testified recently before the Michigan Senate Banking and Financial Institutions Committee on Senate Bill 819, which focuses on insurer-owned repair legislation. Repair facility owners from throughout Michigan packed a Senate hearing room to show support for the legislation.

The legislation prohibits insurance companies from owning or acquiring a repair facility in the state of Michigan. If an insurer has ownership of a repair facility, it must divest itself of that facility within two years of the effective date of the legislation.

Its companion bill in the Michigan House of Representatives, H.R. 5460, allows insurers who own repair facilities as of January 1, 2004, to retain their ownership.

"ASC-MI opposes insurance companies having an ownership interest in automotive repair facilities and views such ownership as being in direct conflict of interest," said Ron Meyer, president of ASC-MI. It eliminates the checks-and-balances system that assures consumer protection. Direct ownership raises barriers for the consumer and forces them to choose the path of least resistance to assure prompt attention to their repair needs. ASC has historically supported the consumer's absolute, unequivocal right to choose a repair facility for a collision or mechanical repair."