SANTA MARIA, CALIF. - A Santa Maria car body shop owner is not happy that insurance companies refer their clients to certain auto body repair shops that are signed up with the direct repair program - a program that he claims eliminates market competition
"I'm angered. Let's say there are 20 shops in a town. They pick like four or five... and that leaves the remaining ones with nothing," the owner of the repair shop on Betteravia Road said. He has owned his company for 40 years and does not want to go public because he's afraid of retaliation.
Patrick Storm, deputy press secretary at California Department of Insurance, told KEYT/KCOY/KKFX insurance companies cannot require a policyholder to get their car fixed at a certain shop; they can, however, recommend specific places for them to go.
Hector Paz owns Premier Auto Body on East Mill Street in Santa Maria. Before becoming a business owner, he worked for a major insurance company and sold direct repair programs.
Now Paz is on the other side of the business and realizes that "the ones with less DRP programs are saying hey this is really tough on us because it's hard to get new customers in the door because they are getting referred from insurance companies." He said "The problem is that the customer is not being informed and that they have the option to go to any facility of their choice."