Call for DRP Study Highlights Auto Insurance Consumer Rights Issue

Share Article advises consumers to be aware that, although auto insurance companies may provide a list of preferred repair shops, most states ensure that consumers have the final say in who performs their repairs.

One Iowa state senator’s call for a study of Direct Repair Programs (DRPs) has brought to the forefront the issue of consumers’ rights in choosing where they have their vehicles repaired in the event of an accident. The legislation recently introduced by state Sen. Brad Zaun advocates for the assembly of a committee that would look into the effects of DRPs on policyholders, repair shops and the availability of cheap auto insurance.

Although the average consumer without ties to the auto repair or insurance industries may not have even heard of a DRP, chances are that their insurers and local repair shops participate in them.

DRPs are agreements set up between carriers and repair shops; coverage providers agree to recommend particular shops to consumers for repairs in return for lower labor costs and higher efficiency levels from those shops. The end result is that the repair shops get a more steady flow of business and insurers get lower costs and quicker turnaround time. But one potential pitfall in this process is the practice of “steering,” which is illegal in a number of states.

Texas auto insurance regulators recently issued a stern warning to insurers in their state about this issue. Insurers are guilty of steering consumers when they imply, either implicitly or explicitly, that some or all repairs will not be covered if they choose to go with a repair shop not included on an insurer’s list of preferred shops.


Such practices are considered to be undue restraints on consumer rights. Generally, it’s OK for insurance providers to give policyholders a list of preferred shops, but it’s generally not OK for them to require a car owner to choose only from that list.

To learn more about this and other coverage issues, readers can go to where visitors will find informative resource pages and a free-to-use quote-comparison generator that can be used to find the most affordable rates among the most reputable carriers.


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Benjamin Zitney
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