Connecticut House Representative Discusses Origins of TPA Bill, Steering and More
April 5, 2011

The Connecticut Insurance and Real Estate Committee currently is reviewing a proposed bill that could add an additional clause to the state’s law addressing third-party administrators and the way consumers contact them. Conn. House Rep. Robert Megna, who introduced the bill, recently took the time to discuss the origins of the legislation—and its future—with™/AGRR magazine.

“Many small auto glass installers have complained to the insurance and real estate committee of an odd relationship [in which ] a glass installer and … a manufacturer (Safelite) is also a third-party claims administrator and that much, if not most, claims were getting routed directly Safelite due to this odd relationship,” says Megna.

Megna says the issue first came to the Insurance and Real Estate Committee’s attention through some interaction with a Safelite lobbyist in a previous legislative session.

“Interesting, originally the issue arose when, I think it was the lobbyist for Safelite, attempted to introduce a bill that prevented the ‘mom and pops’ from marketing to insurance agents and giving promotional items and gift cards—this was last year I believe,” he says. “It was then the committee realized the seemingly large market share Safelite was able to achieve here in Connecticut and that possibly it may not be fostering a competitive environment. Why would one competitor prevent others from trying to market their business? This action seemed odd.”

While the current legislation, H.B. 5283, originally contained a provision 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. However, Megna says the committee hopes to add language that would inform claimants of the relationship early in the process.

“We are working on language at this moment that will encompass the relationship of the insurance company and the insured or claimant at the time a claim is submitted,” he says. “We are not able to involve ourselves in the contractual relationship between the TPA and insurance company.”

He adds, “Within the next few weeks we should have language possibly filed to move forward towards a House vote.”

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