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Wash. OEM procedure bill likely dead this session; sponsor optimistic for 2021

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Associations | Business Practices | Insurance | Legal | Repair Operations
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A bill requiring auto insurers to cover OEM procedures — but with an exemption on “parts, tools, or equipment” — appears to be dead this session, sponsor Rep. Steve Kirby, D-Tacoma, said Tuesday.

“We’re approaching our cutoff now,” Kirby said.

The deadline for House Bill 2782 and other legislation to clear its chamber of origin is Wednesday. Kirby said the remainder of the time would likely be devoted to items bound to generate partisan bickering (such as climate change) with some less controversial items as “filler.”

“I’m not shocked” it didn’t reach the House floor, Kirby said. But he said he was “actually really happy” with the progress of the bill this year.

“I’ve never got this bill out of my committee before,” said Kirby, chairman of the House Consumer Protection and Business Committee. The measure cleared that body 7-6 on Feb. 7, with all seven Democrats in favor and all six Republicans opposed.

“The stars lined up for just a moment,” Kirby said.

Kirby said committee member Rep. Amy Walen, D-Kirkland and chief financial officer of Ford-Hyundai Kirkland, has offered  to help with the bill.

“I also am in the body shop business,” Walen wrote to a Washington Independent Collision Repairer’s Association member after voting to advance the bill out of committee. “This bill needs a lot of work, I won’t support it as is.  I plan to meet with the body shop operators after the legislative session to come up with a compromise policy.”

Kirby said he thought he had “the pieces in place,” and he plans to start next session with the language of the bill that passed the committee.

“I’ve got a strategy to move ahead now,” Kirby said.

The amended HB 2782 stripped out a section amending Washington’s underinsured motorist insurance law and language demanding all policies carry an “appraisal clause.” Kirby said he thought the underinsured motorist proposal might be uncontroversial enough to pass within a separate bill next session. (It requires rental car coverage be part of underinsured motorist coverage like it is in property damage liability insurance.)

The committee-approved HB 2782 demands insurers pay “reasonable and necessary” charges — and puts the burden on the insurer “to prove the unreasonableness of vehicle repair procedures, charges, or both.”

It defines “reasonable and necessary” here as OEM procedures except for those mentioning specific “parts, tools, or equipment”:

“Repair processes” means the explicit processes, tolerances, and other technical requirements or instructions for the repair of a motor vehicle including scans, calibrations, or diagnostic tests of vehicle electronic systems that the motor vehicle manufacturer makes available to dealerships, independent repair shops, and insurers generally. “Repair processes” does not include position statements, recommendations, directives, suggestions, or advice regarding the use of any particular brand, type, or manufacturer of parts, tools, or equipment.

It also states twice that the requirement to cover OEM procedures doesn’t extend to OEM recommendations or mandates regarding parts choice. One of these passages uses language Kirby said came from the alternative parts industry.

“That’ll kill a bill,” Kirby said of the alternative parts choice issue.

The goal was to see the required auto body work done, Kirby said.

Kirby said he also planned to give next year’s bill a narrower title, calling it “very, very dangerous” to have used wording as broad as he did this year. It left the measure open to unwanted items being inserted, he said.

Be heard: Lawmaker contact information can be found here.

Featured image: Washington state Rep. Steve Kirby, D-Tacoma. (Provided by Washington Legislature)

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