Many Auto Body Shop Owners Reach Breaking Point

Posted by Dinesh Kumar on February 24th, 2022

In response to a state house hearing on labor rate reimbursed for collision repairs, more than 29 Massachusetts auto body shop owners voiced concerns about the collapse of their small family businesses. Many noted their frustration and may take action, including removing themselves from a corrupted referral list system maintained by insurance companies.

The Special Commission on Auto Body Labor Rates held the four hour plus hearing on the topic recently on Tuesday, January 25, 2022. Forty-six Massachusetts auto body shop owners were scheduled to express their concerns about unsustainably low reimbursement rates that were artificially set by insurance companies.

Brian Bernard, owner of Total Care Accident Repair in Raynham, one of the independent collision center owners, said the -per-hour reimbursement rate is the lowest in the nation and falls far short of covering the body shop owners’ labor, equipment, training and repair costs. As a result, many consumers have to pay the difference out of pocket, he said.

Bernard said the labor reimbursement rates paid by Massachusetts auto insurers have stayed the same for 11 years. The rates only moved in nearly 34 years. Since 1988 the labor rate has increased will the Consumer Price Index (CPI) has increased 137.7%, .30 and insurance premiums have increased 254%.

For more information about Special Commission on Auto Body Labor Rates, bill # H.1111, please contact Lucky Papageorg, Massachusetts Alliance of Automotive Service Providers, www.aaspma.org.