Belron-Safelite: The Insurer's Perspective

While there has been much speculation as to what the Belron-Safelite merger will mean for independent shops, Hal Hare, corporate claims manager for State Auto, a regional insurer based in Columbus, Ohio, which markets through independent agents, sees it as a minor event with business as usual for the insurance company-third party administrator relationship.

"Belron would be foolish to cancel any contracts that SGC Network has with the insurance companies because of the income stream. The existing contracts will live on. I spoke with my national account representative at SGC and he said it was business as usual," he told glassBYTEs.com™.

Hare said that he sees the acquisition as the foundation for expanded operations by the TPA.

"My understanding is they're doing more hiring, not laying off," he stated. "I think it will be even better service in the future because there are more resources to improve its position and implement new programs."

Hare said that he had met with a senior Belron official at SGC's facility in Columbus, and the mood by everyone was upbeat.

Hare does not see the acquisition raising industry prices.

"I don't know why it would," he said. "The manufacturing costs haven't risen. I think Belron would be sensitive to holding market share and even increasing it, and raising prices would not be the way to do that," he added. "I don't see anything about this move impacting prices. If anything, there is going to be greater economy of scale."

Hare also sees the acquisition as a positive for independent glass shops.

"This is not a threat to the independents. They're going to have to sharpen their pencils and remain competitive; but I don't see a decrease in the use of independent glass shops by my company. I'm looking forward to continued cooperation with them," he stated.

Hare does make one caution.

"Anti-trust could raise its head at some point," he said of the increased size in the market of the new combined company. "It cannot really be an issue since all the major players are still in marketplace. Safelite still has plenty of competition. I think it should be healthy competition, and very interesting," he continued. "I was very impressed with what I saw during the meeting with Belron and Safelite officials," he said. "I see this as a minor change. Safelite should become more efficient and there are opportunities for independents."

Hare has been the only insurance executive who utilizes the SGC Network to engage in dialog with the AGRR industry, and he retained that position with the acquisition. Other insurance executives contacted by glassBYTEs did not want to comment on the event, either on or off the record.