Massachusetts House Bill Designed to Limit Glass Company Ownership of Third-Party Administrators
April 1, 2009

The Massachusetts House of Representatives currently is considering a bill that would prohibit third-party billers for insurance companies from providing auto glass repair and/or replacement services for the same insurance company. The bill defines a third-party biller as "as any company who processes pays and monitors the payment of auto glass claims on behalf of an insurance carrier or insurance producer."

"Such third-party biller shall not be related to any glass replacement repair services in any way," reads H.B. 3680, which would be an amendment to Section 100A of the Massachusetts General Laws. "This includes stock ownership or such ownership by any direct family relative."

If passed, violators (including both insurance companies and third-party administrators) would be fined $1,000 per incident.

The bill, sponsored by Rep. Joyce Spiliotis, also would require that third-party administrators file statements of ownership every year with the Office of the Insurance Commissioner. If enacted, failure to file the statement of ownership would result in a fine of $5,000 per incident.

In addition, the bill includes a provision that would amend the state's current anti-steering law (which prohibits third-party administrators and insurance companies from restricting auto glass company choice), by adding the following clause: "provided that this shall not prevent an insured from specifically requesting information about a particular glass shop and its location."

A spokesperson in Rep. Spiliotis' office advised that the bill came about as a result of the work of a lobbyist named Pat Scanlan of J. McGlynn Law, who is working with an auto glass client. At press time, Scanlan had not responded to calls or e-mails regarding the bill, and the House spokesperson was unable to identify the auto glass company involved.

This is one of two bills dealing with insurer involvement in auto glass claims being reviewed by the Massachusetts House during this session. Rep. Ron Mariano introduced a similarly worded bill, H.B. 952, earlier this year, which would add a section 100B to the commonwealth's General Laws, which also would deal with consumer choice of auto glass shops.

CLICK HERE for full text of H.B. 3680.

CLICK HERE for full text of H.B. 952.

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