When you turn in an insurance claim, your insurance agent will try to “Steer” (i.e. direct) you to a repair shop within his company’s “network” of repair shops.  This network is a group of  preferred repair shops, called a ”Direct Repair Program.” 

In a  Direct Repair Program there is a contractual agreement between an auto insurance company and a collision shop. The shop agrees to provide repairs for the insurance company’s claimants. In return, the insurer will “steer” their clients toward the shop.

Ofter the shop is required, under the contract, to write all estimates using aftermarket parts. And the shop may also be required to bear all liability for repairs and indemnify the insurer from any lawsuit the customer might bring.

The problem with this arrangement is that the repair shop is, in a sense, “bullied” by the insurance company into saving them money on repairs. The shop will use “aftermarket” auto parts to affect repairs. As aftermarket parts are often substandard, the result is usually a “repaired” vehicle that, at best, is more likely to break down and need additional repairs, or at worst, a vehicle which is unsafe to drive.

Dissection of an All-State DRP Shops Repairs

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Neil Jackson on DRP (Direct Repair Provider) Shops and 2nd rate parts