Does my insurance company offer me a direct repair program through a local body shop and how does the process work in dealing with a direct repair shop?

 Some auto insurance companies use a Direct Repair Program to provide repairs for their policy holders. In a Direct Repair Program, a collision shop and an auto insurance company complete a contract to provide repairs for the insurance company’s claimants.

This is how a Direct Repair Program works: You are involved in an accident and contact your insurance company, or the insurer of the at-fault driver. The auto insurance company then refers you to a network of conveniently located repair facilities that offer a limited lifetime warranty on the repairs to your vehicle. The service might also offer on-site rental car arrangements. The insurance company and the collision shop handle all the details and paperwork, so you do not have to.

The collision shop and the auto insurer determine the specific provisions of a Direct Repair Program. The advantage to the collision specialist is the steady stream of referrals or work. A collision shop might participate in one, or several, insurance companies’ Direct Repair Programs.

Although a Direct Repair Program can generate additional paperwork for a body shop, it can also prevent delays. When an additional part is needed for a repair, the shop does not have to stop working on a vehicle to wait for an insurance adjuster to re-evaluate the situation and perhaps write a new estimate. Insurance companies promote the advantages of a Direct Repair Program to their customers as convenience, warranties on repair work, and the freedom from estimates and other paperwork details.

After evaluating the damages to your vehicle, your insurance company has the option of repairing your vehicle, replacing your vehicle, or reimbursing you for the vehicle’s actual cash value (ACV). Actual cash value is the amount your vehicle would have sold for on the date of the accident.

Your insurance will elect to replace your vehicle or reimburse you for the ACV in those instances where the vehicle is economically impractical to repair.

A vehicle is considered economically impractical to repair, or a total loss, if the cost to repair the vehicle equals or exceeds the vehicle’s ACV on the date of the loss. In many instances an insurance company will total a vehicle if the appraised damages equal 80% of the vehicle’s ACV because often, once repairs are begun, additional damages or “hidden damages” are found which would render the vehicle a total loss by definition. (This is sometimes referred to as a “constructive total” loss).

Once the insurance company has the information about the accident including a police report, they will set up an appointment with either a field appraiser or a Direct Repair Auto Body Shop to write the repair estimate.

All insurance companies have different procedures and policies on reporting an accident. Check with your insurance carrier and request the proper steps.