The South African Motor Body Repairers’ Association (SAMBRA), whose members are responsible for repairing over 80% of all insured repair claims in the country, has been one of the strongest advocates for a free market strategy as well as the entrenchment of client’ ‘right of choice’ of service provider since 2019.
Richard Green, national director of the South African Motor Body Repairers’ Association (SAMBRA), says while great progress has been made in opening up OEM approved repairer panels to qualifying accredited Motor Body Repair (MBR) businesses prior to and since 1 July 2021, the system is still being hamstrung by restrictive insurer repair panels.
Green says it is clear from The Guidelines for Competition in the Automotive Aftermarket (The Guidelines), that the Commission is seeking to eliminate the control most Insurers exercise in the allocation of work to motor body repairs through the current methodology of restricting the number of approved panel members on any Insurer service provider listing. “The Guidelines are after all intended to increase transparency and facilitate consumer choice based on the customer’s service and repair quality experience,” he says.
Green feels the slow rate of compliance to the Guidelines is making insurers non-compliant. “It is important to remember two key principles. Firstly, that the insured client has the right to choose their service provider based on prior experience, and secondly, the insurers may not preclude the clients from making that choice by the introduction of commonly used ‘road blocks’ or restrictive practices such as indemnity forms. Clause 8 of the Guidelines specifically refers to promoting inclusive and fair allocation of repair work by insurers.
A survey with one of the country’s larger insurers clearly shows that in spite of clear directives from the Competition Commission, only 36% of SAMBRA accredited MBRs are in fact represented on their national panel. He says this accurately reflects the trend with most of the larger insurers
Green says it is concerning that when MBRs work hard to obtain new OEM approvals, these MBRs are precluded from adding their newly acquired approval to their portfolio, even when they are already on an Insurer panel.
“We feel that by limiting the admittance of accredited MBRs on these panels, insurers are in fact limiting consumer choice and taking away the consumer advantage through increased competition in any area that this additional service provider would bring.”
New applicants are still only being considered on a case by case basis and there is little appetite to increase panels, even with OEM approvals now in place.
“With most insurer panels still only reflecting a SAMBRA accredited member representation percentage of less than 50%, there is reason for concern,” he concludes.
