Why is steering illegal in Real Estate and legal in Collision Repair industry?

Posted: June 16, 2015 in Automobile
Tags: , , , , ,

2015-Subaru-WRX-STI-Engine

According to Wikipedia steering refers to the practice in which real estate brokers guide prospective home buyers towards or away from certain neighborhoods based on their race.

Fair Housing Act makes steering against the law. Just the word itself has negative connotation. In my mind it’s like forcing someone into a direction against their will. It’s a crime often committed and rarely prosecuted. According to WRA, a real estate magazine, there were more than 4 million breaches of Fair Housing Act last year, but only 31 of those cases prosecuted.

Considering this very interesting statistic, it almost makes this crime legal. As luck would have it it’s legal when it concerns collision repair industry. Steering, which allows Auto Insurance Companies to coerce their clients to have their vehicle repaired at the Shop of Insurance Companies’ choice, has passed a legislature several years ago and became a common practice in collision repair industry.

Even though steering has different meaning in real estate and collision repair industry, the gist is the same. Steering is guiding consumers in the direction against their will. Intellectually it is against the laws of our fair nation. So then why insurers are being allowed to practice steering?

It’s a good question. May be it is because steering is one of the most important systems of modern automobile, which allows it to move freely in any direction. Or maybe it is because Insurance Companies have unlimited resources to lobby and therefore legislate and number of collision repair shops cannot get together and unite to oppose financial giants.

In a perfect world it would be illegal, but in a real world Insurance Companies are getting more and more aggressive steering their customers to use body shops that they have discount contracts with. They use intimidation and a coercion to achieve their goals- financial gains.

They tell customers, yes you can go to the shop of your choice, but we won’t be able to approve repairs for a week and you cannot get a rental car until the repair is approved, but if you go to our shop, they will be able to start right away. And sometimes they outright lie – they tell consumers that if they take their vehicle to the shop of their choice, insurance company will not be able to guarantee repairs, when in reality Insurers never guarantee repairs, they just pay for them.

So, why is this happening to you, a sophisticated, 21st century consumer? And why are there so many homeless people in our rich and plentiful country?

Those are the questions that do not have a simple answer; still they should be asked.

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