Ohio Consumer Questions Progressive Insurance Claims Practices

May 2, 2007 by admin
Filed under: Insurance Companies, Ohio, Progressive 

I bought car insurance on my Corvette from Progressive. After having a bad experience with another auto insurance company on an auto accident where I wasn’t even at fault, I saw the television commercials that promised a friendlier approach to claims and thought I’d give Progressive Insurance a try.

The insurance quote I received was lower, just as the television commercials said it might be, and I got comparisons on the spot that showed the hundreds of dollars I could expect to save over buying from other insurance companies. My greatest hope was that with Progressive Insurance being headquartered in Ohio where I live, I might stand a better chance of being treated fair than if I bought an insurance policy from a company headquartered in another state. By exploring coverage at other insurance companies, I hoped I might luck into finding an insurance company that really would be on my side, if you know what I mean.

Overall, Progressive Insurance seemed like a great deal. It was certainly better than I had with my previous insurance company, so I bought insurance coverage on the Corvette and another car.

Now, after having this new insurance policy a few months I’m hearing that Progressive Insurance may be hard to deal with after an auto accident. I’ve read some horror stories on Corvette Forum and other websites that give me reason to be concerned. I know you can’t believe everything you read, but there seems to be a lot of people who are not getting their cars repaired and their claims paid as they believe they should.

What is your opinion of Progressive Insurance and their new approach to claims?

Rick
Cleveland, Ohio

David Williams answers

Thanks Rick for your question about Progressive Insurance and its new claims program called “Concierge.” While Progressive claims this program was designed to save time and make insurance claims go more smoothly for its customers, in reality it very subtly removes many of the choices from car owners, leaving them in the hands of the insurance company where costs controls can be more easily exerted.

Honestly, I see a lot of what I consider to be flawed claims strategies, not just at Progressive Insurance, but among all auto insurance companies that have direct repair programs (DRP). At this time, however, Progressive wins the prize for stooping lower than any other insurer has dared to go. Its unique approach to handling claims puts the insurer in a class of its own - a very low class in my opinion.

Here’s an example of what I mean: Progressive has been widely criticized in auto body circles for hiring inexperienced people. Management sets them up with a computer, a company SUV, and an impressive title. We call them adjusters. These are the field people the Progressive uses to write estimates and settle auto damage claims. This strategy works to Progressive’s advantage because if only half of the damage is observed due to the inexperience of its claims adjusters, the company will never pay the full value of the claims it receives, leaving more money for Progressive to invest. Unfortunately, those who choose not to repair their cars may never know their insurance claims settlements are insufficient to cover all damages.

But, my distaste of the Concierge Service at Progressive doesn’t stop there. In the interest of brevity I’ll not go into each gripe I have. Suffice it to say that my three biggest beefs with the program, in addition to its lackluster hiring practices and removing choice from consumers are:

1) Progressive Insurance makes bogus claims that auto body repair shops in its network repair cars to “generally accepted industry standards for form, fit, finish, durability and functionality, as commonly recognized in the U.S. automobile repair industry at the time of the Covered Repair.”. Problem is, there are no generally accepted industry standards for repair of damaged cars. If Progressive’s claims adjusters assert there are such standards, ask them to provide you a written copy and pass them on to me. I’ll be anxious to read them.

2) Progressive Insurance offers a guarantee on repairs like many other insurance companies do. In my opinion, these guarantees are as worthless as the paper they are written on. If a repair fails, Progressive will go back to the same slothful shop and lean on it to get the vehicle repaired a second, third or fourth time without paying a dime of its own money. If the auto body repair shop refuses to go along with the claims adjuster’s decisions, chances are it will soon find itself removed from the Concierge program. In the end it is the auto body repair shop that stands behind the repairs while Progressive Insurance takes all the credit.

3) Ohio law recognizes the primary measure of damage as being the decrease in a car’s value before a loss as compared to its value after a loss (not after repairs as some claim). Cost of repairs is a secondary measure of damage to be used when no evidence of a decrease in value has been offered. Progressive’s Concierge program, by removing choice, removes a customer’s option to settle their claim based on diminution in value - the primary settlement option - because, by default the secondary settlement option is the only option available. When a customer drops off their car, Progressive sends it to an auto body shop for repairs. These shops, in most cases, are not the best shops in terms of quality. Rather they are the ones that charge the least and who are willing to allow Progressive to muscle them.

I am certain there are auto body repair shops and consumers who think Progressive’s Concierge service is the best thing since sliced bread. However, those I’ve talked to aren’t impressed. Scott Biggs of Asured Performance Network, considers Progressive’s Concierge service a brilliant marketing ploy - “…in reality,” he says, “it’s what every decent body shop in America provides for their customers every day.” In a recent post on his blog, Biggs explains a bit about Progressive’s plans for Concierge, and relates how claims are handled under the program. Writes Scott:

In just the past few years, Progressive Insurance has opened nearly 50 Concierge facilities around the United States with plans to open hundreds more… Concierge represents the boldest actions ever taken by an insurer to mitigate the role a shop plays with the consumer. Body shops, under the terms of the program, are expendable, interchangeable vendors that provide production repair services only. The type of repair quality, repair process and the general costs are clearly defined in their program, and so too is the ownership of the customer. Consumers may never even know who fixed their vehicle…”They claim that, “With Progressive’s new service, a driver simply drops off the damaged vehicle at a service center and, in about 15 minutes, can leave in a rental car, assured that a claims representative will handle the process from beginning to end and that the repairs will be guaranteed.” … Their press release and company-supported news stories say, “A Progressive claims representative prepares a repair estimate and contacts an auto body shop based on its track record of providing superior service and ability to begin work promptly. Both Progressive and the shop reach agreement on the cost of the repairs; the shop then transports the vehicle from the Service Center to its facility and the repair work begins. When the work is finished, the vehicle is returned to the service center where representatives from both Progressive and the body shop inspect the quality of repairs. Once satisfied with the repair quality, Progressive calls the customer and asks him or her to return to the Service Center where, together with the claims representative, the customer inspects the repairs. The customer then leaves with a written guarantee on the repairs that both Progressive and the body shop stand behind as long as the customer owns the vehicle.”

 

Sound good? Perhaps it does if you are the type of person that doesn’t want to be bothered with selecting an auto body repair shop and with petty details such as what level of repair quality you will receive. If you are passive about such matters believing that all repairs are pretty much alike, you might be satisfied with the Concierge service from Progressive.

Oh! What do I think about Concierge?

DO NOT GIVE AWAY YOUR RIGHTS. Progressive is not doing you a favor by offering you this convenient option out of the goodness of its heart, as it is so often portrayed. It’s all about the money the company can save. When you are on the receiving end of an insurance company’s money rather than on the paying end, you’ll nearly always find the cozy relationship you thought you had strained.

My best to you, Rick. Remember, if you drive carefully you’ll be less apt to need high quality auto repairs on that beautiful Corvette.

Link to these articles to learn more:

Repair Quality Below Average in Progressive Concierge Shops
article - www.safecollisionrepairs.com

Money Magazine’s Tips to Make the Most of Car Insurance Claims
article - www.safecollisionrepairs.com

Dealing With Insurance Claims Representatives: What You Hear May Not Always Be Right
article - www.safecollisionrepairs.com

Flaws, Fraud, and Limited Freedom: The Truth About Insurance Referrals to Network DRP shops
article - www.safecollisionrepairs.com

What You Need to Know About Auto Body Shops
article - www.kiplinger.com

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Comments

One Comment on Ohio Consumer Questions Progressive Insurance Claims Practices

  1. admin on Mon, 14th May 2007 11:48 pm

    2. In the 2007 Industry Profile, a special edition of collision repair magazine, “BodyShop Business” May 2007/VOL.26 No.5,body shops rate how insurance companies perform. “Progressive is the clear leader when it comes to refusal to pay, according to respondents. Progressive beat out the No. 2 contender, Farmers, by a 2:1 margin.”

    In addition, Progressive also garnered worst marks in the following areas:

      Insurer’s level of concern for costomer’s best interest
      Knowledge/expertise of field adjusters
      Accuracy of insurer-prepared estimates
      Quality of repair resulting from insurer’s repair policies
      Consistency of insurer’s policies on repair procedures
      Efficiency of claims handling process
      Fairness of reimbursement policies
      Responsiveness of company personnel to shop’s concerns
      Honesty of company personnel

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