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Letter to the Editor
Friday June 7
ASA Applauds Senate Bill 1648 Approval in California - Next Step Is State Assembly
The California Senate passed Senate Bill 1648 by a vote of 29-7. The bill would make it unlawful for insurance companies to have a financial interest in auto body repair facilities. Any insurance companies who currently have an interest in auto body repair facilities would be required to divest themselves within eight years.
The bill would also require an insurer with an interest in an auto body repair business to disclose that interest and give policyholders a choice when they're selecting a repair shop.
The Automotive Service Association (ASA) actively supported this bill and sent letters to collision shop owners in California requesting that they contact their state senators seeking approval of S.B. 1648.
"ASA is extremely pleased with the Senate passage of this bill. We think the Senate made the right decision in supporting 1648," said Bob Redding, ASA's Washington, D.C., representative. "This vote is an overwhelming signal to insurance companies that consumers do not want to see the automotive repair industry continue on the same slippery slope as our nation's health care system. ASA believes consumers have a right to choose, and insurer-owned repair facilities limit those rights," Redding added.
The bill now moves to the California Assembly.
On a related matter, the ASA board of directors approved earlier this year the following policy: ASA opposes insurance companies having a controlling ownership interest in automotive repair facilities and views such ownership as being in direct conflict with the consumers' right to choose. ASA has historically supported the consumers' absolute, unequivocal right to choose a repair facility for a collision or mechanical repair.
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