This publication was developed in consultation with the office of the Alberta Superintendent of Financial Institutions. Sept. 2003
Collision Repairs and Insurance
In this publication you will find information about:
At the scene of the accident
You must always call the police if any of the following happened:- anyone has been injured - either vehicle has more than $1,000 damage, or - one of the drivers has committed an offense.
What to do next
If the damage was not sufficient to call the police, go to a police station to report the accident as soon as possible. Note the file number the police assign to it.
Regardless of which driver is at fault, call your insurance company or agent. Your accident file will be assigned to an insurance adjuster who will ask you to give an accident report.
Choosing a collision shop
IT IS YOUR RIGHT TO HAVE YOUR VEHICLE’S DAMAGE ESTIMATED AND REPAIRED AT THE COLLISION SHOP OF YOUR CHOICE.
The Insurance Act: Market Conduct Regulation requires that if an insurance company recommends that you have a particular shop estimate your claim or provide repairs, the insurance company must give you written notice of your rights to have your repairs estimated and completed by the shop of your choice.
However, the insurance company may, by giving you formal notice in writing, assume complete control of the repair process and have the vehicle repaired where they choose. Insurance companies very rarely exercise their right to undertake repairs; since by doing so they assume final responsibility for a satisfactory repair job.
When you select a shop, the responsibility for a satisfactory repair job rests, finally, with you. Any dispute about the quality of the repair or the collision shop’s guarantee or warranty is a contractual matter between you and the collision shop.
When an insurance company states or implies that they guarantee repairs if you take your vehicle to a shop they choose, ask about the details of that guarantee. Ask to see the written guarantee.
Find out: Who sets the repair standards (you, the shop, or the insurer)? Who decides whether a repair has been properly completed (you or the insurer)? If you are unsatisfied with the repair, who will re-do the work?
Often, an insurance company's guarantee is actually the shop's guarantee and the responsibility for a satisfactory repair job will remain a contractual matter between you and the shop -- just as if you had chosen the shop.
So, it is in your best interest to choose a collision shop carefully!
Look for a collision shop that has the appropriate technology and training to fix your car. Newer vehicles, with their unibody construction, aluminum and alloy components, and sophisticated safety electronics cannot be properly repaired on the same equipment that fixed your grandfather’s Edsel.
Once you have chosen a collision shop advise your insurance company.
It is your right to expect that the repairs carried out as a result of your insurance claim will return your vehicle to its pre-accident condition.
The insurance company’s obligation is to assess the cost of returning your vehicle to pre-accident condition and to advise you of how much they are prepared to pay for the claim. There are two ways to obtain an estimate:
An estimate should specify: (1) What repairs are being done. (2) Whether parts are being replaced or repaired. (3) Whether new or recycled parts are being utilized. And (4) whether new parts are from the original equipment manufacturer (OEM) or from an after-market producer.
If the collision shop or the insurance company plans to utilize recycled or after-market parts compare their warranty to that offered on OEM parts. Also verify that the use of after-market parts will not void any new-vehicle manufacturers warranty, or impact your obligations under a vehicle lease contract – some leases require that all repairs use OEM parts.
Only one estimate is required! However, you may decide to get more than one in order to compare prices and opinions about the extent of repairs. If you get another estimate and it's different, find out why. Most shops use industry-standard estimating programs, and labour and parts prices in a geographical area are similar, so a substantial price difference indicates a difference of opinion as to the nature of the damage or the appropriate repair technique. The best price may not always be the best deal.
The insurance company may accept the collision shop’s estimate of the damage and authorize the repairs or it may want to appraise the vehicle. The insurance company has the right to inspect the damages to your car. Because the quality and extent of the repairs will affect the value of your car, you may wish to be present if the appraiser meets with the collision shop manager to evaluate the damage and discuss the repair procedure.
If you are claiming from your own insurance company, the company is required to provide you with a Proof of Loss form. Complete, sign, and return the form to the insurance company as soon as possible to avoid delay in settling your claim.
Once the insurance company has appraised the vehicle and assessed the damages, their option is to: (1) authorize the repairs, or (2) exercise their right to undertake the repair or replace your car, or (3) pay you the actual cash value of the vehicle if the cost of repairs approaches or exceeds the actual cash value of the vehicle.
If you and your insurance company disagree
If the amount of damage to your vehicle is being disputed or other disagreements arise over your vehicle's repair, and all attempts to negotiate have failed, an inexpensive formal arbitration process exists. The process is known as "Appraisal."
If you choose to follow this procedure, you will be responsible for your share of the cost involved. To start the Appraisal procedure, send a written request to your insurance company. If you haven't already submitted a Proof of Loss form, do so right away.
A three-member panel will resolve the dispute. You select an appraiser, the insurance company selects one, and the two appraisers appoint an umpire. An appraiser can be anyone either party considers to be qualified to present its side of the dispute. Each side pays for its own appraiser and half the cost of the umpire. The decision of any two of these persons is binding and final.
Getting the repairs on your vehicle completed
After the insurance company has approved your claim, the collision shop can begin repairs. The shop will ask you to sign a work order authorizing the repairs. Make sure it specifies all the details outlined in the estimate. Any changes or additions to the job and the related costs should be written on the work order.
Your signature on the work order means that you are ultimately responsible for the invoiced costs.
Once the repairs are done, check them over. You may decide to have an independent party look at them. If you are not satisfied with the repairs, discuss the problem with the collision shop manager. If the problem isn't resolved, notify the insurance company.
There are several methods of paying the bill: (1) The insurance company may forward to you the money to pay the collision shop. (2) Or the insurance company may pay the shop directly. (3) Or the insurance company may send a cheque jointly payable to you and the collision shop. You may be responsible for paying the amount of the deductible, as noted in your insurance contract. Once the shop has been paid, or when the insurance company has confirmed it will pay the invoice on your behalf, you can take your car home.
Dealing with the other driver's insurance company
If the other driver caused the accident, you have two options:
1. You may claim under your own collision coverage, if you carry it. Your company will pay your claims, then deal with the other insurance company. With this option, you may have to pay your deductible up front, but you or your insurance company can attempt to recover it from the other insurance company or the other driver. When you claim on your own policy, the formal Appraisal process is open to you.
2. You may claim directly against the other driver through his or her insurance company. If you wish to do this, notify that company after calling your own insurance company. Many of the steps listed above still apply. You select a collision shop and obtain an estimate, but your dealings are with the other company. However, if you choose this option, the provision for formal Appraisal does not apply.
The other driver's insurance company may ask you to sign a release form before paying you or the collision shop you have chosen. When you sign a release form, you discharge the other person and his or her insurance company from any further liability to you. It is a final payment! Read the form carefully to make sure that you are releasing only the claims for which you have settled.
If your claim has not been finalized with regard to personal injuries you suffered in the accident, make sure the form does not release liability for your injury. You may wish to consult a lawyer.
If the other driver refuses to file a report with his or her insurance company, the company may deny your claim unless you sue the driver in court and get a judgement.
FOR MORE INFORMATION
If you have other questions about collision repairs, speak directly to the manager of the collision shop you have chosen.
For more information about the collision repair industry contact the Automotive Service and Repair Association: 1-800-282-9909
The regulatory agency for mechanical and collision repair businesses in Alberta is the Alberta Motor Vehicle Industry Council: 1-877-313-3833
For more information about insurance matters, speak with your insurance agent or company.
The regulatory agency for the licensing of insurance agents, brokers and adjusters is the Alberta Insurance Council. The Council investigates consumer complaints into the actions of insurance companies, agents, brokers and adjusters in Alberta. 1-800-461-3367
orwww.abcouncil.ab.ca This Consumer Tipsheet was produced and distributed by the Automotive Service and Repair Association and its quality assurance program CCAR.
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