Closing the Gap – Part 17

Having discussed a solution that would be effective, but unfortunately is out of our immediate control, let’s look at a solution that is.

Solution 2 – Create a Property Industry Conference

As was stated in Part 12 of our series, the leading barrier to progress is that the property insurance claims and the property damage repair industries do not institutionally speak with one another. There currently exists no meaningful forum to discuss and resolve structural issues that affect both industries for the benefit of both industries.  And in this regard, it is not just insurers and restorers who need to have a dialogue. It is also information providers (e.g., Xactware), product vendors (e.g., DriEaz), TPAs (e.g. Code Blue), and other third-party service providers (e.g., Cunningham Lindsey, FRS Team, Horticultural Asset Management, Wondermakers, etc.)  It is the entirety of the property damage industry.

Therefore, what I propose as a more practical solution is to collectively create a new forum called the Property Industry Conference, or PIC, that would meet four to five times a year to collaboratively address significant issues facing our industry. If this sounds like a pie in the sky concept, it is not. In fact, it is a time-tested idea that works. All we have to do is look to our colleagues in the auto collision industry to see this.

The Collision Industry Conference was created in 1984 and has a clear mission:

“The Collision Industry Conference (CIC) is a forum where collision industry stakeholders come together to discuss issues, build broad understanding, find common ground and communicate to the industry at-large, findings and possible solutions.” 

Its vision is a noble one. It calls for “a collision industry in which all segments work together efficiently, effectively, ethically and respectfully to enable a complete and safe repair while facilitating the most pleasant experience possible for our mutual customer, the consumer.” 

Amazingly, it works.

One of the reasons it works is because it is open to everyone and there is no hierarchy. Everyone comes to the table as equals four to five times a year. Chairpersons of the CIC are elected every two years from amongst the entire industry, and past chairpersons have included body shop owners, insurance claims executives, information provider executives, consultants and newsletter publishers. Everyone gets to participate.  Committees that do real work have participation from anyone who wishes to be involved, representing all industry segments.

Twenty-eight years after its creation, there are currently 11 CIC committees to address critical issues as defined by all CIC participants. They include Education and Training, Business Improvement Task Force, Governmental, Human Resources Task Force, Data Privacy Task Force and Insurer Relations. Committee members currently include representatives from Amica, Allstate, Storm Appraisal, California Casualty and Progressive, in addition to Chrysler, Mercedes Benz and nearly 50 other industry organizations and companies, many of them independent auto body shop owners.

Working committees do not exist merely to exist. When their work is done, they disband  and their results are available for all to use.  There are 20 such committees whose work is complete (such as Cycle Time Task Force, Vehicle Repairability, Estimating Practices and Procedures and Database Task Force), their tasks have been combined with other working groups (Legislative combined with Governmental), or they have been spun off into a stand-alone organization (Electronic Communication.)

It is this last committee that represents CIC’s greatest task-oriented achievement.   Fifteen years ago, the body shop industry faced a financial crisis because there were three computerized estimating systems in the industry (think of them as Xactimate, Simsol and MS Boeckh) and different insurers required the use of a specific system to participate in their network programs. This required thousands of body shops to license all three estimating systems. They often ran on three different computer systems, tripling overhead expense because none of the systems could talk to each other through a standard interface.

To stem this crisis, CIC created the Electronic Communication Committee. Its task was to create a common communications standard so that a body shop could license the estimating system of their choice, and it would effectively communicate to any insurance carrier in the language that the insurer wanted. In essence, the goal was to meet everyone’s needs in the most efficient and affordable way possible.

That committee spawned the Collision Industry Electronic Commerce Association (CIECA). For the last decade, shop owners have made their own choice about estimating systems rather than having it dictated to them. CIECA currently has five officers and 22 trustees, including representatives from all segments of the industry.

In spite of the valuable attainment of estimating system interoperability, the greatest overall achievement of CIC remains the fact that insurers and shop owners, parts suppliers and estimating system providers are all at the same table. They are working together to solve common problems so that all can prosper. Imagine the impact that such a structure could create within our industry.

Indeed, imagine BELFOR, Crawford Contractor Connection, American Family, Xactware, Dri-Eaz, DKI, Itel, Alacrity, Symbility, Liberty Mutual, IICRC, Home Depot, Jon Don, WonderMakers, Business Networks, Fiberlock, Sunbelt Rentals, State Farm, Code Blue, RIA, Paul Davis, independent restorers and dozens of other entities meeting regularly as equals at a Property Insurance Conference to address the issues facing the industry. To be sure, many of the participants will be fierce competitors. But there is a difference between two companies competing strategically and two companies flushing money down the drain because of market barriers that create waste without creating value. Imagine if we could collaboratively figure out how to:

  • best address the impact of mortgage companies holding on to claims payments that rightfully belong to a contractor for work provided,
  • reduce the necessity of filing liens against property owners,
  • enhance communications between repairers and insurers, and
  • develop best practices for documentation so that claims could be paid faster,
  • and much more

The benefits to our industry are endless and the actual cost of action very small.

Collectively, we can do it.

At our company, we have enjoyed a wonderful relationship with one particular client. At the very heart of our strategic success with them is a single word: communication. It is the focus of everything we do because we jointly understand that high quality communication minimizes problems that waste the precious resources of time and money. We have minimized the gap between insurer and restorer with one client, proving it can be done. It is my hope that we can extend this simple concept to our entire industry through a Property Industry Conference so that the gap can be minimized by all.

(To be continued with the final installment of this series…)

 

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