Current through Register 1531, September 27, 2024
(1)
Consumer's Choice of Shop: No direct payment plan
approved under 211 CMR 123.000, and no insurer in implementing such plan, shall
require a claimant to have repairs made at any specific repair shop.
(2)
Number of Shops:
(a) Every plan must provide that every
claimant will be given a single list containing the names and locations of all
registered repair shops as defined in
211 CMR 123.03 that
appear on the list of registered repair shops maintained by the Division of
Standards pursuant to M.G.L. c. 100A, § 6. The insurer may indicate by
clearly marking with an asterisk or other means of highlighting on the list of
all registered repair shops at least five repair shops geographically
convenient for the claimant which will perform the repairs on referred claims
without undue delay. An insurer shall not provide a separate list containing
only its referral shops. A repair shop may not be an insurer's referral shop
unless that repair shop appears on the list of all registered repair shops
maintained by the Division of Standards and complies with the provisions of
M.G.L. c. 100A. The claimant may or may not choose to use an insurer's referral
shop.
(b) The list of all
registered repair shops maintained by the Division of Standards pursuant to
M.G.L. c. 100A, § 6 shall be updated quarterly. The Automobile Insurers
Bureau of Massachusetts or any successor thereto shall maintain a separate list
containing the names and locations of all registered repair shops as defined in
211 CMR 123.03 that
appear on the list maintained by the Division of Standards. For the purposes
stated in 211 CMR 123.06(2)(a), every insurer with an approved Direct Payment
Plan shall reproduce the listing of all registered repair shops maintained by
the Automobile Insurers Bureau of Massachusetts or any successor thereto. The
list given to the claimants by the insurers pursuant to 211 CMR 123.06(2)(a)
shall not exceed 12 standard size (81/2 by 11 inches) pages unless the
Commissioner has given a written waiver of this requirement.
(c) Any individual insurer wishing to
implement a plan which does not contain at least five repair referral shops
geographically convenient for the claimant which will perform the repairs on
referred claims may petition the Commissioner for a waiver of this requirement.
The insurer seeking such a waiver shall set forth the specific facts regarding
market share, geographic location, availability of repair shops, or other
circumstances in support of its petition. No insurer may implement a plan which
does not meet this requirement unless and until the Commissioner has granted a
petition for waiver.
(3)
Insurer's Choice of Shops:
(a) Insurer's referral shops shall include
only shops:
1. which are registered repair
shops; and
2. which have entered
into an agreement satisfactory to the insurer, to complete repairs for
claimants referred by the insurer without undue delay, for the amount of the
direct payment to the insured plus any applicable deductible, plus any
supplemental payment authorized by the insurer.
(b) In determining which registered repair
shops willbe referral shops, the insurer shall consider all of the following
criteria, and only the following criteria: the quality and cost of repairs at a
particular shop, the quality of the service given the customer, the
responsiveness of the shop to the customer's needs, the ability of the shop to
perform repairs without undue delay, the geographic convenience of the shop for
the claimant, cooperation of the shop with the pre- and post-repair inspections
and the shop's compliance with applicable laws and regulations.
Each individual insurer shall maintain written guidelines
incorporating these criteria as applied by the insurer in implementing its
plan; such guidelines shall be deemed to be a part of the individual insurer's
plan. While individual insurers which have adopted an industry plan shall
maintain such written guidelines, under no circumstances shall a rating
organization which files an industry plan propose or maintain such guidelines.
Individual insurers' guidelines shall be made available to the Commissioner
upon his or her request and shall also be made available to any repair shop in
the event the insurer denies that shop's request to be a referral shop or
revokes the referral shop agreement of any referral shop.
A repair shop shall be included as an insurer's referral shop
if the shop agrees in writing to comply fully with the plan, unless the shop's
request is denied or the shop's referral shop agreement is revoked pursuant to
211 CMR 123.06(4), and is determined by the insurer not to satisfy one or more
of the criteria listed above. The form of agreement between the insurer and the
insurer's referral shops may provide adequate assurances that the repair shop
will continue to satisfy the insurer as to such criteria.
(4)
Development and
Changes of Referral Shops: An insurer may deny a repair shop's
request to be a referral shop or revoke a referral shop's agreement, provided
the insurer files a statement with the Commissioner specifying the nature of
the shop's failure to comply with the plan or with the agreement or proposed
agreement between the insurer and the repair shop. A repair shop which claims
that it has been improperly denied as a referral shop or whose referral shop
agreement has been revoked may demand arbitration. Such binding arbitration
shall be conducted by a neutral arbitrator jointly agreed to by the insurer and
the repair shop, or, in the absence of such agreement, within 21 days of
submission of the request for arbitration to the insurer, by an arbitrator
selected by the Commissioner. The parties to the arbitration shall bear the
costs of the arbitration equally, but the losing party shall be liable to the
prevailing party for its costs, unless the arbitrator orders otherwise. If the
arbitrator finds that the losing party acted in bad faith, he or she may also
award the prevailing party attorney's fees, if any. The arbitrator shall
determine whether the repair shop was improperly denied, but shall make no
finding or order as to any damages other than the award of costs and /or
attorney' s fees, if any. The decision of the arbitrator shall be
final.
(5)
Insurer's
Guarantee: If a claimant has repairs performed at a repair shop
included on the insurer's list, then the insurer shall guarantee the quality of
the materials and workmanship used in making the repairs. No insurer may
petition the Commissioner for a waiver of this requirement. This guarantee by
the insurer shall be in addition to all other guarantees which may be made by
the manufacturer and the repair shop. The agreement between the insurer and the
repair shop may provide for indemnification of the insurer by the repair shop
for any costs associated with such guarantee under such terms and conditions as
the parties to the agreement shall specify.
(6)
Reinspection
Requirements: Every plan shall provide that the insurer shall have
a licensed automobile damage appraiser reinspect vehicles following completion
of repairs as follows:
(a) with respect to
repairs as to which the appraisal indicates that the cost is expected to exceed
$4,000, at least 75% of such vehicles shall be reinspected;
(b) with respect to repairs as to which the
appraisal indicates that the cost is not expected to exceed $4,000, at least
25% of such vehicles shall be reinspected.
In no event shall the selection of vehicles for reinspection be
based on the age or sex of the policyholder or of the customary operators of
the vehicle, or on the principal place of garaging the vehicle, or on whether
the repairs were performed at a repair shop that is not a referral repair
shop.
(7)
Conflicts of Interest:
(a) No employee or agent of an insurer with
responsibility for entering into referral shop agreements as prescribed in 211
CMR 123.06(3) shall receive or ask for any payment, gift or any other thing of
value from any repair shop seeking to be a referral shop or from any referral
shop. No repair shop, or employee or owner thereof, shall give, payor offer to
give or pay, any thing of value to any employee or agent of an insurer with
responsibility for creating, managing or maintaining a list of repair shops. No
repair shop, or employee, owner or agent thereof, shall give or pay, or offer
to give or pay, or offer to give or pay, any thing of value to any person in
exchange for being included, or as an inducement for being included, as an
insurer's referral shop. For purposes of
211 CMR
123.08(7)(a), the words
"employee", "owner" and "agent" shall also include any spouse or child of an
employee, owner or agent.
(b) A
discount on parts, glass, labor rate or other item or customer service in
connection with the repair of motor vehicles offered by a repair shop to an
insurer shall not constitute a "payment, gift or any other thing of value" for
purposes of 211 CMR 123.06(7)(a).
