Let Me Count the Ways

Some of you may be familiar with the title of this message. It is from a sonnet written by the poet Elizabeth Barrett Browning. It is a love poem…but I read it as an analogy to a story of fraud. More specifically, think of fraud being perpetrated against insureds, legislators, collision repairers and – yes, in some instances – insurance companies. There are several ways fraud can be inflicted upon the insured during the repair process. In some cases, it is done with intent and malice of forethought. Whether by intention or not, what is important to note is that the attempt to defraud the insured is not initiated at the time of repair but in the process leading up to that repair.

Upon having an accident, the insured has been well trained to contact their insurer as quickly as possible. Therefore, the claimant is led down the insurer’s preferred path early. The insurer has painstakingly developed very specific word tracks for their claims department personnel to follow when speaking to claimants. It starts right from the first call when the claimant is notified that their conversation may be recorded for “training” purposes. The traumatized claimants may hear the words but often are unaware of the unintended consequences of speaking on a recorded line. Along with being traumatized, the word tracks are meant to solicit certain responses that are NOT always in the claimant’s best interest.

Once the unknowing claimant has been lured in and comforted by the claims representative and made to feel that they are dealing with a “friend” who is there to “help” them, the fraud continues through further word tracks intended to get the vehicle repaired where the insurer – rather than the claimant – wants the work done. “Steering” is just as much an issue today as ever before. Here are some all-too-common examples of word track use:

“We cannot guarantee how long it will take to even ‘see’ your vehicle if you do not use one of our shops.” “We may not be able to cover all the procedures or the labor your shop may charge.” “We guarantee the work at our shops.”

All of these statements, either alone or in combination, do not tell the whole story and are fraudulent ways to coerce the claimant to choose from the insurer’s list of shops. Each of these statements are “clearly” covered by regulation and are intentionally misrepresented to the unknowing claimant.

Next up is, “You can take your vehicle to one of our shops, and they can start working on the vehicle right away.” Better yet: “You could take a bunch of photos for us and send them in, and we will write a thorough estimate.” When was the last time you saw an estimate (whether written in a drive-in claims center or from photos taken by the claimant or a road appraiser) that did not need a substantial supplement just to cover (under the regulations) “all the parts, labor, materials and necessary procedures […]” for damages that could not have been reasonably anticipated at the time of the appraisal? In my opinion, this is an intentional attempt to knowingly defraud the claimant. It is done in the hopes that the vehicle owner does not go to “one of those problem shops” that is aware of all the needed procedures and takes the time to document them. Saying that it will be “made right” on a supplement openly bastardizes the purpose of that supplement, which is NOT a “get out of jail free” card for the staff or independent appraiser. It is not intended to legitimize fraudulent acts by staff or independent appraisers – whether they are instructed to write in this fashion or are just incompetent.

Granted, this could be an “oops, I missed that” situation in some cases. But what about every time an insurance company appraiser knowingly writes at an insufficient rate for paint and materials? The appraiser is ignoring the rules and regulations or is intentionally submitting paperwork they know to be fraudulent, If it’s the latter, the appraiser is doing this, as stated in 212 CMR 2.02 (5), “under the pains and penalties of perjury”! All they need to do is look back at the hundreds of supplements they have written to see how insufficient the $17 per paint hour (in the case of one insurer) actually is. Again, whether intentional fraud or just incompetency, both should be subject to action against the appraiser’s license. Even if the appraiser is being instructed to follow certain guidelines, they are liable for their actions. It would be no different than if you were driving a vehicle and I were your passenger. If I instructed you to blow through a red light and we got caught, you could point at me all you want, but you would still be the one getting the ticket! As licensed appraisers, we must all be held to the same level of accountability. Every appraiser out there knows this, and most of them sympathize with collision repairers when discussing what they know to be an artificially controlled rate of reimbursement for the work performed. Knowing it to be the case does not excuse ignoring the facts. Every appraiser who writes an estimate below a collision repair shop’s posted Labor Rate is committing fraud, and they know it.

While we are counting the ways, let’s consider the fraud that is being committed against the claimant by a Board that is charged with protecting the public. Every time a complaint has been dismissed without further investigation by the Auto Damage Appraiser Licensing Board (ADALB) for omissions and failure to properly negotiate all aspects of a repair (leading to poorly written appraisals by licensed appraisers), a fraud is allowed to take place against the claimant and the public at-large. It is not without trying. It is difficult for the ADALB to be impartial when it is slanted to one side by the advantage of just one vote belonging to the Insurance Commissioner’s appointed