As a result, Mauro says, Maaco "changed its marketing thrust to address those who would swarm to pay out of pocket rather than suffer the ongoing financial penalty of making an insurance claim."
Mauro says Maaco "also pioneered the finance of consumer repairs in 1995," with zero percent interest and no-money down incentives.
Carstar is a smaller firm but it went through much the same change and is now offering financing to people who want to keep their repair records off of the insurance records.
Carstar president and CEO Sam Mercanti says the decision to offer the Preferred Payment Plan was the result of direct consumer demand. In the last year, he says, the percentage of people who do not claim the deductible on some repair work has gone from 10 to 30 percent.
"We had to do something to combat this," Mercanti says. "We're losing a lot of business. We're losing about 10 percent to backyard firms, and I hope to get that back."
Carstar's payment plan is good for as much as $4,000 in collision costs, and it can be spread over 24 months. A consumer is automatically approved if the vehicle is less than nine years old, has fewer than 160,000 km, the cost of the collision repair is between $500 and $4,000, and their vehicle is fully insured.
"It's an opportunity for consumers to get vehicles repaired at a good rate," Mercanti notes, and "it also helps some of the brokers" since it gives them something to offer customers who are upset when they hear how much their premiums will go up if they make a claim.
"Consumers are scared and that's not the way it should be," Mercanti says, "and to be afraid to use something that you pay for like this is not right."
Along with initiatives from private firms such as Maaco and Carstar, Saskatchewan's industry company has just announced that it will do something similar.
The provincial insurance agency will operate the Deductible Payment Plan, which will allow customers with basic auto insurance to repair their vehicle immediately after it is damaged, then pay off the deductible over a period of 10 months.
"People don't plan to have an accident," says SGI minister Maynard Sonntag, "and sometimes paying the deductible can be tough on the family budget. It doesn't matter how a vehicle is damaged -- collision, vandalism or theft -- if a customer has a deductible to pay, and is eligible under the program, they can access the plan."
The Saskatchewan plan involves the car owner making a $100 down payment when she or he picks up the car, with the balance withdrawn from their bank over 10 months. There is no interest, but there is a one-time $30 administration fee charged at the same time as the first payment.