New Online Auto Insurance FAQ Touches on 'Steering' Issue

Houston, TX, May 25, 2011 --( A new FAQ recently published on discusses what happens in the event that an insurer disagrees with the repair estimate produced by a shop chosen by the policyholder. At one point in the article, the writers highlight “steering,” an important issue related to auto insurance that many consumers may not be familiar with.

In many states, there are laws on the books saying that consumers have the right to choose the repair shop that fixes their vehicle after an accident. But insurers may still suggest or recommend that the policyholder go to one of its preferred shops (often called direct repair facilities). Some coverage providers have agreements in place with these facilities that allow them expedited, discount service in exchange for putting those shops on the preferred list and driving them business traffic.

But when coverage providers explicitly or implicitly state that a policyholder must choose from only the insurer’s preferred facilities, the coverage provider is in effect “steering” the policyholder - a practice that violates the consumer’s legal right to choose their repair shop.

Texas car insurance regulators addressed this topic in a bulletin and a report to the state legislature last year. In that state, the top five personal auto insurers “all had some sort of contract/agreement with direct repair facilities or had selected repair facilities to be on a preferred list,” the results of a survey conducted in May 2010 showed. In 2009, repairs covered by those five insurers were performed at direct repair facilities between 18 and 50 percent of the time, according to regulators’ 2010 report to the state legislature.


This may be an issue that motorists would want to keep in mind when coordinating repairs with an insurance company. To find out about state laws regarding a policyholder’s right to choose, consumers can visit the website of their state’s department of insurance.

To learn more about this and other coverage issues, readers can go to where visitors will have access to informative resource pages and a quote-comparison generator to help users find the best rates on a policy.

To get to the full FAQ, visitors should click on the “Questions” link located at the top of any page on the site.

Online Auto Insurance
Benjamin Zitney