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Collision course: a special report on the collision industry in conjunction with the international autobody congress and exposition.

Sometimes adjusters and appraisers are forced to deal with the frustrations that can stem from working through the collision claim process. But there are a few forces out there working to make sure the auto claim experience runs a bit smoother and making the auto physical damage claim process easier on everyone. There also are new resources available that are stepping up auto claim efficiency, drawing lots of praise from policyholders and ensuring that everyone walks away from the experience with a positive feeling.

Technology and Customer Service

There are a few new tools surfacing that are using to improve the quality of communication between insurer, repair shop, and customer. Autochex is a customer satisfaction evaluation tool that the auto repair and insurance communities use by conducting a short survey over the phone with insureds who have had their cars repaired or who have filed a claim. The system deals mostly with the auto physical damage side of the business and aims to find out how satisfied customers are with the experience and the entire claim process.

Autochex also takes better communication a step further with a system called AutoView, which applies to both the shop and to the insurance company.

"AutoView is really a way of getting the information out to the stakeholders in the field so that they can see the results of the surveys. Basically, they log into a secure web site that is updated with information every 24 hours, and as we conduct surveys, we post the results right up to the site," said Ray Kihara, director of customer service indexing at Autochex. "In conjunction with that, we also have an e-mail alert process where if the customer expresses some kind of dissatisfaction with the repair or the claim process, we can immediately e-mail the [collision repairer or insurer]. It is much quicker than postcards or other methods that use standard mail."

Like most industries today, collision repair is changing with the times to help increase customer satisfaction and productivity.

"With vehicles becoming more and more complex, I think it's incumbent on both the shop appraisers as well as the insurance company appraisers to really be current on the correct repair procedures," said Greg Horn vice president of industry relations at Mitchell International. "That is going to become more and more important as time goes on, because now there is technology in manufactured cars that cannot be produced in the collision repair environment."


Horn would know. He is the author of Mitchell's 2007 Industry Trends Report for this year's third quarter. He made it clear that as an information products and software provider for the collision repair industry, Mitchell has a significant interest in being involved with evaluating customer service. Their quarterly report outlines the issues and trends that are impacting the auto collision repair industry by focusing on a sampling

of more than 500,000 estimates where aftermarket collision parts had been specified on the original estimate and the effect they had on cycle times and supplements.

"We are really involved in measuring customer satisfaction and we have seen that customers are satisfied when you make your promised delivery time," said Horn. "Claimants are very keen on being informed, so much so that if you miss a delivery time, they will actually give you a pass as long as you keep them informed and tell them what is going on with the repair."

"It has made the process faster to the point that we can contact the customer sooner after they have picked up their vehicle or received payment for their claim and really measure their satisfaction," added Kihara. "We know that the faster we get to them, the faster the collision shop or the insurer can respond to their complaint, which in turn means a better chance for recovery. It's a simple process. We get a phone number, we call the customer, we find out how happy they are, and then we report back to the people who can affect the satisfaction or the recovery process."

Direct Repair to the Rescue?

One thing about collision repair claims that everyone can relate to is the feeling of, "What is going on with the car?" One insurance company is making strides in keeping the policyholder in the loop when it comes to this aspect.

Nationwide Insurance has offered the Blue Ribbon Repair Program for almost 15 years and currently works with approximately 2,500 shops in all of the states that they do business. Direct repair programs also benefit all of the involved parties through a system of checks that monitors the performance of the repair shops that participate.

In addition to the program, Nationwide also offers a service called AutoWatch, a tool that allows the customer to follow the repairs on the web with digital images. This concept has paved the way for insurers to go as far as guaranteeing customer satisfaction.

"The camera doesn't lie," said Horn. "If you have the repair estimate spelled out and you know someone is looking at that periodically, the repair is going to be carried in out in accordance with how the estimate was written."

Repair shops have good reason to stay in the graces of insurers. Large carriers recently began limiting the number of collision repair shops they use as part of their direct repair programs because for the claim adjuster, the process of meeting their assigned number of claims becomes a much easier task when they don't have to deal with an unwieldy number of shops

"For a large carrier, this consolidates the work that the adjusters have to do by making fewer calls on body shops," said Charlie Baker of Ford Motors' Collision Certified Repair Network. "If they are required to look at seven adjustments a day, it is a lot easier for them when they only have to go to two shops. If they have to go to seven different shops in a city where traffic is a disaster such as Los Angeles or Atlanta, it will be very difficult for them to get around and complete their job requirements."

Direct repair programs like State Farm's Select Service program, Nationwide's Blue Ribbon repair program, or Progressives Concierge Service are making it easier for insurers, repair shops, and customers to stay in contact throughout the claim and repair process.

"We allow the customer to go wherever they want," said Terry Fortner, associate vice president of claims at Nationwide Insurance. "But the advantages of being a part of our Blue Ribbon program and having a claim handled through one of our shops are great. We have detailed contracts with each shop, and we communicate electronically with them, which includes images of the vehicle as well as estimates. But what is most important to the customer is that we guarantee the repairs as long as the customer owns or leases the vehicle."

Fortner went on to describe how auto repair facilities are chosen in Nationwide's program.

"The shops are being pre-qualified, which means there are stringent requirements that they must meet from an equipment, facility, technology, and staffing standpoint," said Fortner. "We have a very tight quality assurance program to monitor the performance and service of the collision repair facility."

The advancement of technology, communications, and customer service in the auto collision repair industry has led to an increase in the quality of work that the repair shops produce.

"These kinds of programs have been to the advantage of the larger insurance companies today because they want to consolidate their work into fewer shops," said Baker. "With Select Service, State Farm cut the number shops they were using for the program almost in half in an effort to only do business with shops that they have confidence in. That way, they know quality work is being done on time and the likeliness of fraud is being avoided. Years ago, insurance companies thought it was advantageous to have lots of shops competing for the work because they believed it would keep labor costs down. While that may have been true, it did not always mean that quality repairs were being completed on time. The smaller shops cannot afford the training and the sophisticated equipment that is required today, and the insurance industry is recognizing that."

Isn't that what everyone is looking for in this industry? Quality work, done on time. Direct repair programs seem to have it right when it comes to covering all the bases in auto physical damage claims. Since claim adjusters are stretched thin and overloaded with files, any help they can get is icing on the cake.

This topic and other collision repair trends will be discussed in-depth at the International Autobody Congress and Exposition (NACE) Conference, which takes place Oct. 31-Nov. 3, 2007. The conference is meant to be a resource for a wide range of collision repair industry professionals and will feature sessions recommended for insurance professionals.

A Primer for Part Types

Think you know everything about collision repair parts? See if you recognize these common terms.

* Original Equipment Manufacturer (OEM): Parts produced directly by the vehicle's manufacturer or their authorized supplier, and delivered through the manufacturer's designated and approved supply channels. This category covers all automotive parts, including sheet metal and mechanical parts.

* Aftermarket: Parts produced and/or supplied by firms ether than the OEM's designated supply channel. This may also include those parts originally manufactured by endorsed OEM suppliers, which have later followed alternative distribution and sales processes. While this part category is often only associated with crash replacement parts, the automotive aftermarket also includes a large variety of mechanical and custom parts as well.

* Non-New/Remanufactured: Parts removed from an existing vehicle that are cleaned, inspected, repaired and/or rebuilt, usually back to OEM specifications, and re-marketed through either the OEM or alternative supply chains. While commonly associated with mechanical hard parts such as alternators, starters, and engines, remanufactured parts may also include select crash parts such as urethane, bumpers, radiators, and wheels.

* Like Kind and Quality: Parts removed from a salvaged vehicle and re-marketed through private or consolidated auto part recyclers. This category commonly includes all types of parts and assemblies, especially body, interior, and mechanical parts.

Source: Mitchell International, Inc.

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Copyright 2007 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Feature Story
Author:Houts, Michael
Date:Oct 1, 2007
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