A bill has been proposed in the Kentucky legislature that may affect auto glass shops in the state if passed. House Bill 243 (HB243) outlines a series of unlawful actions for persons selling, repairing or replacing safety equipment in vehicles.

According to HB243, “‘safety equipment’ shall mean only the glass used in the windshield, doors and windows, and the glass, plastic or other material used in the lights required by KRS Chapter 189 on any automobile.”

Unlawful practices listed in the proposed bill include:

• Knowingly submitting a claim to an insurer or third-party administrator for safety equipment repair or replacement services if the equipment was not previously damaged to the extent that the repair or replacement warrants; for services not provided; for showing work performed in a different geographical area which results in higher payments; without owner, lessee or insured driver authorization; for showing work performed on a date different than performed which changes insurance coverage status; or making any other “material misrepresentation” related to safety equipment;
• Telling someone else, such as a policyholder or any other person to falsify the date damage occurred to safety equipment, which results in a change of insurance coverage for a repair or replacement;
• Falsely signing a work order, insurance assignment form or other related form on behalf of a policyholder or other person to submit a claim to an insurer for a repair or replacement;
• Knowingly misrepresenting to a policyholder that a repair or replacement pricing billed to the insurer, insurer authorization of the repair or replacement or telling a policyholder that a repair or replacement will not increase his premium or affect coverage;
• Telling a policyholder or other person that his insurer will cover the entire cost of the repair or replacement with no cost to the policyholder unless coverage has been verified by the insurer or third-party administrator;
• Adding to the damage of the safety equipment before repair to increase the scope of a repair or replacement or encourage the policyholder to add damage;
• Performing work beyond the scope of a repair or replacement;
• Waiving or offering to waive a policyholder’s deductible, in full or part, or offer rebates, gifts or anything of value to a third party in exchange for policyholder referrals to the repair or replacement facility in connection with any claim under an insurance policy;
• Waiving or offering to waive, in full or partial, the policyholder’s deductible, or offering rebates, gifts or anything of value to an insured in exchange for the insured filing a claim under an insurance policy; and
• Misrepresenting the relationship between a repair or replacement retailer and the policyholder’s insurer.

In addition, the legislation would prohibit a repair or replacement facility from threatening or intimidating an insured into filing a claim, engaging in unfair or deceptive practices to induce a claim, inducing a claim when damage is insufficient to warrant repair or replacement, performing services without insurer authorization, misrepresenting coverage available to the insured, and representing that coverage for the insured under the insurance policy is free.

Other notes in the HB243 say that violations of these practices may be enforced and they Department of Insurance Division of Insurance Fraud Investigation may “seek and obtain in an action in circuit court an injunction that prohibits a person from engaging in practices or doing any acts that violate this section.”

Proposed repercussions include fines of up to $5,000 per violation.

HB 243 had not yet passed the House at press time.