Connecticut House Seeks to Outlaw Insurance Incentives from Glass Shops
February 26, 2010

A Connecticut representative released a bill this week that would make it illegal both for auto glass shop representatives to offer incentives to insurance agents to encourage them to refer work to a particular shop—and would make it illegal for agents to take incentives as well.

The bill, H.B. 5298, would read as follows, with respect to the portion applying to auto glass businesses:

No owner, employee or agent of a motor vehicle glass repair shop, or a spouse or child of an owner, employee or agent of such motor vehicle glass repair shop, shall provide or offer any rebate, gift, prize or other item of value to (1) an employee or agent of an insurance company, or (2) a spouse or child of such employee or agent, in exchange for selecting such motor vehicle glass repair shop to perform motor vehicle glass repairs.

The bill notes that "rebate, gift, prize or other item of value" does not include discounts on parts, glass, labor rates or any other item included on an invoice. The provision carries a maximum fine of $2,000 per violation.

Likewise, the bill would add the following guidelines for insurers:

No (A) insurance company doing business in this state, (B) employee, agent or adjuster of such company, or (C) spouse or child of an employee, agent or adjuster of such insurance company, shall request, require or accept any rebate, gift, prize or other item of value from an automobile glass repair shop as an inducement to or as a condition for referring an insured to such automobile glass repair shop.

Fines for insurers in violation of this provision are not stipulated within the bill.

H.B. 5298 currently is being reviewed in the joint committee on insurance and real estate, and a public hearing is scheduled for next Tuesday, March 2.

CLICK HERE for the full text of the bill.

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