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Letter to the Editor

AAI Applauds MN Legislature Override of Veto to Enact Glass Repair Law

Both houses of the Minnesota Legislature have overridden a gubernatorial veto to enact a bill that gives insurers more control over the cost of automobile glass repair in the state, to the ultimate benefit of consumers according to the American Association of Insurers.

The bill, which will become law June 30 (House File 2570), requires insurers to pay only automobile glass claim costs that are fair and reasonable within the local industry, a standard similar to that for other automobile repair work. It also permits insurers to suggest a glass repair vendor, although the insurer must notify the policyholder of their right to choose any repair shop.

"The Alliance commends the action of the Minnesota Legislature in enacting this badly needed bill," said Kirk Hansen, director of claims for the Alliance of American Insurers. "Minnesota has the highest glass repair costs in the country, and this bill will bring some sanity to the pricing structure of glass repair in the state."

The bill went through several iterations before the final version was reached. "An original version of the bill would have made all referrals illegal," Hansen said.

The Alliance was successful arguing against amendments banning referrals by arguing that they robbed insurers of their First Amendment right to free speech. "In all other industries referrals are made as a matter of course," Hansen pointed out. "Doctors, lawyers and all other professionals routinely make referrals. Without this new law, every industry in Minnesota would have had the right to make referrals except the insurance industry. Ironically, the insurance industry has more expertise in evaluating repair shops than any other profession, yet it would have been prevented from sharing its knowledge due to the amendment. The new law "will enable insurers to get a better handle on runaway glass repair claims costs that have been reflecting in consumers auto rates," he concluded.

The Alliance of American Insurers, based in Downers Grove, Illinois, is a national trade association representing 326 property/casualty insurance companies.

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