Bill Addressing Auto Glass Inspections, TPAs
and More Introduced in Arizona
January 26, 2011
An Arizona legislator has introduced a bill
that would amend the state's insurance code to add language addressing
auto glass inspections required by insurers, would define several
prohibitions for third-party glass claims administrators (TPAs)
and would prohibit insurers and TPAs from having a financial interest
in auto glass replacement companies.
Regarding auto glass inspections, which some
insurers now require prior to authorizing work, the bill would
prohibit insurers and TPAs from causing "a delay in the inspection
of a policyholder's auto glass condition in the handling of a policyholder's
claim regardless of which repair facility the policyholder chooses."
Along the same lines, when an inspection is required, the bill would
require "that the inspector must be a direct employee of the
insurer or an independent party who is unrelated and unaffiliated
with any glass repair facility."
S.B. 1238 defines an inspector as "a party who is engaged in
the physical inspection of a claimant's vehicle for the purposes
of adjusting a claim."
In addition, it would expand the state's current anti-steering law,
which requires insurers to advise consumers of their right to choose
an auto glass repair facility when providing information about a
glass repair facility, to make the same requirement of TPAs.
The following language, "The insurer or [TPA] shall not in
any manner coerce or induce an insured to use a glass repair facility
other than the insured's chosen facility, if the insured has chosen
a facility," also would be added to the law, under the current
text of the bill, if passed.
S.B. 1238 further proposes that an "insurer that uses the services
of a [TPA] is responsible for the [TPA's] acts that are within the
scope of the motor vehicle insurance policy or under this article."
The bill also would require insurers to "notify the policyholder
whether glass to be used will be original equipment glass or previously
used glass, where the glass was manufactured and whether the glass
was specifically manufactured for use in the claimant's vehicle"
at the time the claim is authorized for repair.
Likewise, the bill would prohibit insurance adjusters, auto damage
appraisers and TPAs that process auto glass claims from "hav[ing]
a financial interest in or be[ing] an affiliate of a business that
installs or repairs automotive glass."
Lastly, the bill, introduced this week by Arizona state Sen. John
McComish, would define a third-party administrator as "any
person who collects charges or premiums from or paid on behalf of,
or who provides administrative services to or adjusts or settles
claims by, residents of this state in connection with motor vehicle
If passed, the changes would fall into the same section of the law
developed last year, which included several provisions related to
Need more info and analysis about the issues?
Subscribe to AGRR Magazine.