Minn. Legislature Overrides Veto on Glass Reform

April 2, 2002

The Minnesota legislature has voted overwhelmingly to override Governor Jesse Ventura’s veto of legislation that bans glass dealers from offering rebates and give-away incentives.

The bill (HB 2570) repeals the current Department of Commerce price survey mechanism in favor of the more common fair and reasonable standard for a specific geographical area. In addition, insurers that recommend glass vendors would be required to tell consumers that they have a right to go to any vendor of their choice. The new law takes effect immediately.

“Amending the glass repair statute benefits consumers, insurers and glass shops,” Laura Kotelman, counsel for the National Association of Independent Insurers (NAII), said. “The glass repair climate in Minnesota has created a difficult situation for insurers who merely want to take care of their customers’ repairs at a reasonable cost. The practice of providing rebates increased the cost of repairs and ultimately affected the auto insurance rates for all consumers. The bill addresses many of the factors that cause glass repairs in Minnesota to be more costly than in other nearby states.”

Although the bill was strongly supported in the legislature, Gov. Ventura vetoed the legislation. In his veto message Gov. Ventura expressed his concern that the legislation would adversely affect small glass dealers.

“If factors such as advertising and service costs are ignored (in developing the cost of auto glass replacement), we will lose the small glass replacement operators. If the small operators are lost, glass replacement choices will be limited to those large operators with high volumes that have a more direct relationship with insurers. This will hurt the consumer by limiting flexibility and choice,” Ventura commented.

However, Illinois amended its glass repair statute in 1992 to allow insurers to pay a “fair and reasonable” price and today that state has one-third more glass shops doing business in the six county Chicago-area than in 1992.

“This demonstrates that glass repair is still a profitable business despite the change to a claims system allowing insurers to pay a fair and reasonable price. The Minnesota bill protects the small glass shops by requiring a special notice to consumers that they can choose any glass shop they desire to perform car window repair or replacement. It also helps glass shops in rural areas resolve geographic price variances,” Kotelman added.

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