Auto Glass Monopoly?

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    NEWSLETTERS

    At some point, most drivers will need to get their car windshield repaired or replaced. A state law took effect this year that supposed to give you options, but as troubleshooter George Colli found out, that may not be the case. (Published Tuesday, Jul 8, 2014)

    At some point, most drivers will need to get their car windshield repaired or replaced.

    With mobile, at home or in-shop service available within days, if not hours, the state insurance department does not get many complaints from consumers.

    But it’s a different story if you ask any of the dozens of independent or family-run auto glass shops in Connecticut, many of which spoke out enough that state legislators passed a new law.

    Public Act 13-67, An Act Concerning Automotive Glass Work, became effective at the start of 2014 and is meant to protect independent companies from having business steered to larger, out-of-state companies.

    Before the law even took effect, one international company filed an injunction to halt its implementation: Safelite Group, LLC.

    The Ohio-based company consists of the nation’s largest third-party administrator, Safelite Solutions and the largest auto glass company, Safelite Auto Glass.

    Third-party administrators are contracted by insurance companies to handle auto glass claims, and a majority of the nation’s insurance companies use Safelite Solutions.

    Company representatives say they agree with the law requiring them to notify consumers that they have the right to choose who performs the work. They claim they already do.

    Their issue is with the provision that states the company must provide the name of a competitor if an offer is made to the consumer to use Safelite Auto Glass.

    “We strongly feel this violates our First Amendment right to free speech,” said Brian M. DiMasi, Safelite Group Senior Corporate Counsel. “That is why we are challenging it.”

    Now, all industry eyes are on the Constitution State and the outcome of a pending Second Circuit Court of Appeals decision.

    While Safelite representatives attest they are complying with the law, the NBC Connecticut Troubleshooters found that may not be the case.

    Steven Petrauskas, a Goshen resident, said he requested to have Plymouth Glass and Mirror in nearby Thomaston perform the windshield replacement on his truck, but Safelite Solutions set him up with an appointment at a Safelite Auto Glass shop in the Hartford area, more than an hour away.

    “I spelled Plymouth. I spelled Thomaston for her. I explained her that I wanted that company and they still made the appointment with Safelite. I didn’t get it,” said Petrauskas.

    After complaining to his insurance company and to Safelite Solutions, Petrauskas eventually had the work done at Plymouth Glass and Mirror.

    But this is a common issue, according to Nikki Maloid, whose family has owned the company since the early 1980s.

    “Our customers are telling us they’re being pushed to a specific company – Safelite Auto Glass. They’re being told that they need to use this company, or they may not be covered under warranty,” said Maloid.

    Safelite did issue a response to the Petrauskas complaint:

    “We are aware of the complaint from Mr. Petrauskas and are investigating what took place. While Safelite Solutions dedicates significant resources in training its CSRs, sometimes human error may occur and that is what we believed happened here.”

    Gerard O’Sullivan, the Director of Consumer Affairs for the Department of Insurance, acknowledged that the company has not had many complaints from consumers regarding business steering in the auto glass repair and replacement industry. He said the department holds insurance companies responsible for any action takes by a third party administrator.

    O'Sullivan noted that the department has posted signs at auto body shops for years, displaying their contact information for anyone who may feel their being pushed to one business or another.

    “Steering is difficult to prove,” O’Sullivan said. “We’ll look at phone scripts that companies use and make sure they’re in compliance and following state insurance laws and regulations.”

    Along with the attempt at an injunction, the Safelite Group, LLC has also sued Attorney General George Jepsen and Insurance Commissioner Thomas Leonardi.

    Jaclyn Falkowski, spokesperson for the attorney general, released the following statement:

    "The state has a long-standing interest in protecting consumer choice in automobile glass repairs covered by insurance. We believe the federal District Court's decision upholding the law was thorough, and correct. We will continue to defend the statute."

    The Second Circuit Court of Appeals heard oral arguments in the case last month. The lower courts have already ruled in favor of the state, but Safelite Group is hoping the Second Circuit Court will overturn those decisions.

    The future of small mom-and-pop auto glass shops may just hang in the balance.