Connecticut Insurance and Real Estate Committee Re-Drafts TPA Bill, Issues Joint Favorable Vote
March 21, 2011

The Connecticut Insurance and Real Estate Committee has re-drafted an auto glass-related bill following a public hearing that occurred in late February. While the proposed bill contained language that would have prohibited an insurance adjustor or third-party administrator (TPA) “from having a financial interest in a business that installs automotive glass,” the newly drafted bill, dated March 8, no longer contains this language.

Instead, the new draft would add an additional clause to the state’s law addressing third-party administrators and the way consumers contact them. The new clause would make it illegal for insurers to “refer or route any insured directly or indirectly to a third-party adjuster or third-party claims administrator for claims or questions regarding automobile physical damage repairs, automobile glass replacement, automobile glass repair service or automobile glass products, without requiring the insured to contact directly the insured's insurance company first by telephone, facsimile or electronic means.”

In addition, the law would require the insurer to “inform such insured that the insured has the right to choose the licensed repair shop or facility where (A) the damage to the insured's motor vehicle will be repaired, or (B) the automobile glass will be repaired or replaced, as applicable.”

H.B. 5283 also would add a clause to the state’s law that would prohibit insurers from “guarantee[ing] or warrant[ing] the repair or replacement work performed by a licensed repair shop or facility for automobile physical damage repairs, automobile glass replacement, automobile glass repair service or automobile glass replacement, automobile glass repair service or automobile glass products.”

Also included in the draft legislation is a provision that would make it illegal for insurers to “impose a monetary advantage or penalty for such repair or replacement work that could affect an insured’s choice of a repair shop or facility, including, but not limited to, lowering or waiving the insured’s deductible under the insured’s policy.”

If passed, the bill, introduced by House Rep. Robert Megna, would go into effect on October 1. The Insurance and Real Estate Committee voted 12-8 to issue a joint-favorable report on the bill last week. It now has been referred to the Office of Legislative Research and the Office of Fiscal Analsysis, which is slated to review the legislation on March 28 at 10 a.m.

A spokesperson for Megna’s office declined to comment on the changes in the bill and how they came about, and Megna had not yet responded to requests for comment at press time.

Need more info and analysis about the issues?
Subscribe to AGRR Magazine.