Massachusetts AG: Insurer to Pay for Faulty Repairs

A subsidiary of Allstate has agreed to pay for the correction of faulty repair work performed on motor vehicles brought to unregistered body shops in Massachusetts.

The assurance of discontinuance with Encompass Insurance, filed in Suffolk Superior Court in Boston on Sept. 24, alleges that in multiple instances the insurer did not verify a body shop’s certifications and paid unregistered shops for repairs made to its policyholders’ vehicles.

Massachusetts Attorney General Maura Healey said Encompass has agreed to inspect the vehicles that were previously brought to unregistered shops and paid for directly. If the inspection determines that the repairs Encompass paid for were faulty, Encompass will pay to have the problems corrected by a registered shop. Under Massachusetts law, insurers are prohibited from paying body shops directly for repairs made pursuant to their collision and comprehensive coverages, unless that shop represents that it is registered with the state and complies with Massachusetts laws.

Encompass will make a $25,000 payment to the state and also train its staff regularly on this issue, as well as maintain an updated list of registered shops.