Recently, I had to seek authorization for a 2015 Toyota Highlander windshield. I received the okay for the glass and upper moulding immediately. However, as I have not done that model before, the Toyota parts person recommended getting the two side mouldings and ten clips saying I could always return them if not needed. So I added the twelve parts into my request.
When questioned by the third-party administrator (TPA) customer service representative (CSR), I explained what Toyota’s parts’ person had recommended. Anything unused I planned to return. The answer I received was pure classical insurance doublespeak: “I can’t approve anything on speculation. If you find out that you need these parts when the job is being done, you may call at that time and seek approval.” Thanks, lady. You tell my customer it’s not a problem for me to leave a job incomplete without a moulding or two. Should I just use “liquid clips” to secure that moulding somewhat permanently?
Incident two: I had a 2014 Odyssey windshield to replace at a Honda dealership. Upon inspection, it was obvious the glass had been replaced prior. The prior replacement included OE Honda glass, but T-105 generic moulding was used (and crooked) as an upper moulding. The person who did the installation broke every clip and used urethane to adhere both post mouldings to body. I ordered all new clips and mouldings and returned following day to do the job. I can’t read the installer’s mind who handled this job, but it was obvious he was not a Boy Scout. “Be prepared” was not the mindset. “Be cheap” was.
These two common tales underscores so much what is going on in AGR.
First of all, what is the prime directive in AGR? Is it doing the job right or squeezing the most revenue or least liability out at the given price point?
From every indication I’ve come across, the vehicle’s owner is the real loser in most cases. It just doesn’t matter if the client has insurance or not. What is usually put back in his car is not of the same quality in both product and workmanship.
We have a “corporate poster child” whose vans are filled with rolls of generic moulding and private-label glass. Trained on rental cars first, their pay plan basically is: More jobs, more pay.
On the other side, we have hordes of ignorant hacks whose only objective is “Sell it cheap, do it even cheaper.”
Let’s touch upon the virtual splintering of the once strong automotive glass retailers pricing structure into the morass that it is today. To put it bluntly: We are our own worst enemy. There are several factors that have led to this, but none larger than the efforts of insurers to set retailers against each other. It becomes a scenario of bid demands which have morphed into the ‘fair and reasonable” phrase that reflects only what is equitable to the insurer.
With “big glass” controlling much of the insurance market, a company is faced either with carving out market niches or adapting to the cyber shopping world of low pricing. Add in the fact that there is a low cost to enter into the business, and we have a minion-like marketplace awash with tiny players, many of whose business models are simply designed to undercut the competition in price and make it up in volume. To do so, cutting costs in materials and labor time is of paramount importance. That last sentence is also the mantra for our largest installation company as well. What they don’t produce internally, they have the size to attract or demand favorable acquisition pricing. I am professionally embarrassed when I see some of their installs and observe what they use to substitute for OE mouldings. In some cases, what they use are as bad as the worst out there.
In fairness, any insurer doing a cash market survey would easily learn competition between shops has brought down pricing. Any large insurer would logically use its market size to pressure its existing vendors to give it discounts and achieve savings on glass claims.
The ascent of TPAs have further weakened the economic position of glass retailers. TPAs make it possible for insurers to minimize administrative and overall claim expenses. They also insulate an insurer to some degree in liability. If variations of the guaranteed average invoice pricing (GAI) are used in contracts between TPAs and insurers, derivatives and other re-insurance contracts can be purchased insulating both parties from unexpected events that would increase claims and impact profits. One other outcome is that the use of TPAs generally removes the local selling agent from the claim process. In the past, that person or agency could financially benefit by directing claims to favored vendors. In reality, some local remuneration still goes on but it has moved much more up the corporate ladder between the major players.
The existence of TPAs do not benefit AGR retailers in the least. At the minimum, they set pricing parameters and delay payments. They act as a disruptive entity between vendor and customer. However, when the nation’s largest TPA with the most insurer clients is a subsidiary of the world’s preeminent automotive glass corporation it becomes an ethical minefield that screams for reform. These screams go unheard.
There is an unspoken but very real adversarial relationship between insurer/TPA and retailer. This is justified by issues of short pays and other sins on their side to fraud from ours. However, only in America can the biggest wolf be found guarding the insurer henhouse as a TPA owner.
Yet, the greatest frustration comes from the lack of unity among the thousands of glass shop owners. While AGR has some fair-sized regional players, the greatest number of shops are single to dual point stores. We lack the will to unite, and unless we can do that, our political and economic futures will continue to decline and be controlled by larger corporate and social forces.
I have observed a real downward spiral over the past two decades in AGR and if we had some prior intestinal fortitude to speak up and act collegially, we could have affected some outcomes. Are we typical Americans who only react when disaster is imminent instead of looking ahead and seeing and avoiding danger? You had better look up fast because that tipping point is far too close. To repeat my oft cited cartoon adage “We have met the enemy and he is us!”
Better get cracking!