Managing the insurance claims process for maximum profit

Updated Jul 17, 2024
A crashed semi truck

For heavy-duty collision repair, information is money.

Shane Carder at MHC Kenworth has been on both sides, the insurance company’s and now, the shop. He says gathering the right information is critical to making money for the shop — and for the customer.

“Build a file,” he told attendees at HD Repair Forum earlier this year. That means taking supporting photos and documenting as much of the process as you can. The more shops document repairs, the more they can be compensated for. It also builds communication, Carder says, which can gain the shop a long-term customer.

“As a repair shop, we play a crucial role in the heavy-duty repair claims process,” he says. “With proper communication and documentation, we have the opportunity to gain a customer and further build a relationship with the insurance carrier.”

Set a Process

At Housby, they have a step-by-step process for collision repair to ensure the shop recoups the most cost and the customer gets back on the road and making money as quickly as possible.

Jeremy Shuey, body and paint shop manager, says it starts with a thorough inspection. The truck is checked in and scanned — even if there are no warning lights on the dashboard — and inspected for damage. Techs disassemble and map damaged parts and determine what can be pre-painted.

Then it’s time for supplements, which Carder calls “a necessary evil.”

“Write up the supplement as you do the disassembly for accuracy alongside the tech,” Shuey suggests. “Send off the supplement for parts pricing. Send (it) to the vehicle owner and/or insurance company for approval to proceed with repairs.”

All the parts removed from the truck go on a cart and are mirror-matched with new parts as they arrive.

The vehicle then moves to one of three repair streams: express, medium or heavy. The stream, Shuey says, depends on the hours needed to repair the vehicle. Then it goes through a quality control process, post-scan and, finally, delivery to the customer.

“Ideally,” Shuey says, by then, “you have already pre-closed the file and the customer is aware of all charges.”

Some OEMs have specific repair processes for their products.

“The biggest difference is the cab-over design,” says John Spoto, director of collision for Premier Truck Group. “The kinetic energy travels through the vehicle or responds completely differently than a unitized construction like an auto. We follow repair procedures by Freightliner.”

Premier’s goal is to have the vehicle “respond like the factory built it.”

More than Meets the Eye

With collision repair, damage may not be immediately evident. That can bring insurer, shop and customer into conflict.

“The customer sees their vehicle as, ‘the bumper has slight damage,’” Spoto says. “Well, we must keep in mind mitigation (ADAS systems) must be calibrated.”

Education can be the best tool in the box when it comes to heading off problems. Shuey says the partnership between shop and insurance is just that, a partnership.

“Insurance adjusters and companies have more access to OEM standards and procedures than ever,” he says. “We have had adjusters and insurance companies working with us over the years, and we focus on quality, safe repairs. We’ve had great luck with our adjusters and carriers wanting the same.”

Since the COVID-19 pandemic, those adjusters are more frequently remote, relying on the shop to provide clear information, including photos. Proper photos, he says, follow FOIL: Four corners, Odometer, Identifier, License plate. They should also include the area of impact, all damaged parts and any non-related damage.

“You try to educate the owner with virtual photos, you cannot see all the damage,” he warns. “Let the owner know during your VDA, vehicle damage analysis, you will likely find additional items that must be addressed.”

Those additional items can add time to the repairs if the analysis isn’t done properly. A well-done assessment with clear, thorough documentation means the shop can get started on repairs even if more damage and supplements are needed later.

“Taking your time upfront enables you to sprint to the finish line, not vice versa,” he says.

Direct Repair and Repair vs. Replace

More common in automotive collision repair, direct repair shops are pre-approved by an insurer. The shop will have an agreement with the insurer to repair vehicles at a predetermined price, which can save time on repairs. There are downsides to these programs; some shops argue direct repair processes put insurance companies too far in the driver’s seat of the repair.

Premier does direct repair, and Spoto says it’s becoming more prevalent in the heavy-duty industry thanks to vehicle technology.

Another constant debate in the industry is repair versus replace.

“I’m a big repair guy,” Carder says. “No offense to the parts people, but I sell labor, not parts. I truly like to repair everything I can.”

And there’s a reason behind it too. Carder says if you can repair a part and keep the truck from totaling, that generates more business for the shop and, along with a quick, safe and complete repair, can make for a happier customer.

Happy customers come back, adding up to more money for the shop in the end.

“Focus on training, tooling and improved processes to increase gross profit,” Shuey says. “Cutting expenses are great, but the largest results are in proper tooling, training and processes.

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