The Oklahoma House passed an amended bill Thursday that will cap storage fees for total loss vehicles at $39 for gas vehicles and $125 a day for electric vehicles (EVs) that have sustained damage to the battery pack. 

On the 11th day, the storage rate can increase to $75 a day and $200 for EVs, according to the bill. 

Mark Tedford (R-69), a sponsor for SB641, fielded multiple questions from representatives prior to the House vote of 58-32. 

Oklahoma Sen. Lonnie Paxton (R-23), an Oklahoma Farm Bureau insurance agent, introduced the bill Feb. 3. The original language in the bill, passed by the Senate Business and Insurance Committee, allowed insurance companies to provide incentives to consumers for the use of certain repair shops. 

This language was removed from the original bill and replaced with storage cap language similar to SB784 while on the Senate floor. The bill was never picked up for discussion in the Business and Insurance Committee. 

The amended SB641, passed Thursday, will need another vote from the Senate before going to the governor. The amended version raised the rate for EV storage from $78 to $125. 

According to the bill, the state’s department of insurance will be required to annually review the storage rate for inflation. 

The bill also restricts administrative charges for total loss vehicles to four hours. 

“Everybody is getting something from this bill, and it provides consumer protections for insurers,” Tedford told the House floor Wednesday. 

Jim Olsen (R-2) asked why the state would need to regulate prices in a free market. 

“Nobody shops what their storage rate is for total loss vehicles ahead of time, and this bill would smooth over issues we are having with a big disparity between pricing, where there is a surprise bill several days into the storage, where there are thousands of dollars of storage costs,” Tedford replied. 

Tedford said insurance companies have provisions in their policies that require “normal customary pricing” and wouldn’t pay the rates regardless. He said the rates only cause fights between the shops and insurance companies and delay the process further. 

“It is not something that is truly a free market,” Tedford said. 

Forrest Bennett (D-92) asked Tedford to explain what happens when insurance companies have to pay more for storage costs. 

“If these excess storage fees are going to be charged, they are just passed through to the consumer; ultimately, we will all pay these higher rates,” Tedford responded. 

Chris Sneed (R-14) said that he was told there are 910 shops in the state, but only four bad actors, three of which are out of business. 

Sneed asked Tedford, “Would you agree that maybe we don’t need to continue with the bill since they are out of business?”  

Tedford responded that he has been unable to verify that there were only four bad actors. He said in a review of invoices, he found various shops charging high rates for storage. 

“The narrative I got from the body shops is that they were charging excessive rates to incentive the carriers to get the car off their lots quicker,” Tedford said. “I think this practice is more widespread than just four body shops.” 

Sneed responded, “Maybe we should come back and run a bill that would encourage the insurance companies to pick up their vehicles quicker next year.” 

Tedford acknowledged that there is a problem with some carriers but argued that the issue is not connected to the bill. 

“I think there are several insurance companies that are having problems in their claim departments that are very slow,” Tedford said. “I think it is an independent problem from whether body shops are charging rates that are excessive of what is normal and customary.” 

Mike Dobrinski (R-59) said he supported the bill because, in his research, he found a wide variety of charges between urban and rural shops.

“That ultimately comes back in higher rates for customers, it is in the best interest for us,” Dobrinski said. 

Collision repair shops have argued it is impossible to set standard pricing for storage because the cost for storing a vehicle is determined on multiple variables including the cost of the property the shop sits on, and the security measures used to store the vehicle, such as lighting, cameras and fencing. The use of property to store a vehicle also results in the loss of intaking new vehicles to repair, which can result in lost revenue. This lost revenue could vary depending on the certification level of technicans and the type of vehicles repaired.

Many of these arguments have been raised during multiple hearings held by the California Bureau of Automotive Repair (BAR) as it works to set regulations on storage fees in the state.

Robert Manager (R-101) asked if insurance companies have their own storage lots to haul total loss vehicles to. 

“I don’t believe insurance carriers have lots themselves, and I do agree that they should try to get those vehicles off those lots as quick as possible,” Tedford said. “I don’t know what mechanisms the companies have.” 

Marilyn Stark (R-100) asked what storage requirements are needed to store EV vehicles. 

Tedford responded that some manufacturers require up to 50 feet for EV storage if a battery is suspected to be damaged. 

“That would take an extra space on the lot,” Tedford said. “It [the bill] has a higher rate for EVs being stored.” 

Stark asked, “Would you agree that it could be problematic for small dealers?” 

“There may be some shops that cannot accommodate EVs because of their storage requirements,” Tedford said. “Fifty feet would take maybe sometimes 30 or 40 spots and might cost $1,500 to $2,000 a day for storage, that is just not something anybody is going to pay. They have that problem now, even without this bill.”

Andy Fugate (D-94) said some shops may be using the market to force insurance companies to move quicker. 

Tedford responded that any slowness in a claim is separate from the storage rate and that the storage rate only causes a dispute that further disrupts the process. 

Fugate asked, “If the insurance company has a dysfunction, why should this body enable it to continue with that dysfunction? It seems like a market with a high price. For instance, it might force that insurance company to clean house and get additional services to handle the capacity issues.”

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Mard Tedford (R-6) speaks on the Oklahoma House floor May 8/screenshot