After legislators failed to overturn Governor’s veto of procedure bill this year, legislation has been pre-filed for next year’s session.
The fight to get auto insurance companies to pay for the cost of vehicle manufacturer repair procedures will reignite in New Hampshire next year. The new legislation, House Bill 1455 (HB 1455), mirrors the legislation this year that sought to incorporate vehicle manufacturer collision repair procedures into state law governing claims handling practices.
Earlier this year, New Hampshire House Bill 664 (HB 664), that was approved by the legislature in June, sought to amend New Hampshire’s Unfair Insurance Practices by adding a new section specifying that claims payments must be made based upon OEM repair procedures, though not OEM parts recommendations that may be included in the procedures.
In August, New Hampshire Governor Chris Sununu vetoed the legislation over concerns that the bill would increase insurance premiums and hurt competition for repairs. Members of the New Hampshire House of Representatives were just a handful of votes short from overriding the veto having voted September 18 241-132 in favor of the bill. To override the veto, a 2/3 majority was necessary.
In a statement announcing the Governor’s veto, John Elias, Commissioner, New Hampshire Insurance Department said, “The New Hampshire Insurance Department knows that the intentions behind this bill were good. All of the parties worked very hard to come to an agreement. The Department feels that the same parties, with sufficient time in the future, will be able to work together to ensure that the bill can be designed to fulfill the important interest of industry and consumers in a way that is consistent with the original intent of the sponsors.”
The legislation was supported by the Automotive Service Association and the Alliance of Automobile Manufacturers as part of their effort to bring the issue of OEM collision repair procedures to state legislatures that was announced last year. ASA had recently called on the industry to write Governor Sununu requesting his support for the legislation.
As with this year’s legislation, HB 1455 adds a new paragraph detailing vehicle repair standards to New Hampshire’s Unfair Insurance Practices. The bill amends RSA 417:4 by inserting after paragraph XXIII the following new paragraph:
XXIV. Vehicle Repair Standards. No insurance company, agent, or adjuster shall knowingly fail to pay a claim to the claimant or repairer to the extent the claimant’s vehicle is repaired in conformance with applicable manufacturer’s procedures. Notwithstanding any statements or recommendations contained in the manufacturer’s procedures relative to the use of parts, governance of the use of any and all parts, in the course of an insurer-funded repair shall be solely dictated by RSA 407-D:3-a and not by a manufacturer’s recommendations or procedures.
(a) If the vehicle is equipped with an advanced driver assistance system, an automotive glass company, repair facility, or insurer informing, approving, or conducting glass repair or replacement shall:
(1) Prior to approving or performing glass repair or replacement, inform the consumer if a calibration of that system is required and if such calibration will be performed;
(2) If performing such calibration, meet or exceed the manufacturer’s procedures or specifications; and
(3) If a calibration was not performed or not completed successfully, inform the consumer that the vehicle should be taken to a vehicle manufacturer’s certified dealership, a qualified automobile glass company, repair facility, or other qualified repairer capable of performing the calibration of an advanced driver assistance system that meets or exceeds the manufacturer’s procedures or specifications.
(b) If the vehicle is equipped with an advanced driver assistance system, an automotive glass company, repair facility, or insurer informing, approving, or conducting a scan or calibration for motor vehicle repairs or replacement:
(1) Shall not be limited to tooling or equipment dictated or recommended by the manufacturer’s procedures or specifications.
(2) Shall calibrate an advanced driver assistance system meeting or exceeding the manufacturer’s procedures or specifications.
(c) If a repairer does not accept a paint and materials estimate proposed by an insurer, the insurer shall reimburse the repairer based on any third-party guidelines generally accepted by automobile repair shops and insurers, and used by the repairer.
(d) In this paragraph, “manufacturer’s procedures” means a manufacturer’s written procedures, specifications, tolerances, and other technical requirements or instructions with respect to repairs.
When the New Hampshire legislature convenes in January for its new legislative session, the bill will be assigned to the Commerce and Consumer Affairs.
According to the fiscal note on the legislation, the Insurance Department indicates the bill could lead to an increase in complaints to the Department’s Consumer Services Division from repair facilities questioning insurers’ adherence to the statute. While unable to predict the volume of additional queries and complaints, the Department cautions that it might possibly require an additional staff position in the Market Conduct Division to investigate the complaints generated by the bill.
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