I do understand what your saying with regards to insurance company's...my experience has been that these life time warranties that they offer are rarely paid out and it has to be a glaring screw up on the body shop's behalf that would make an insurance company pay out. Most often the shop that did the substandard repair has to re-repair the vehicle at the body shops expense, not the insurance company. I know of one instance where a customer had a repair done, was out of town and the faulty repair caused the customer not to be able to drive his car...after a lot of screaming and yelling and back and forth, the insurance company allowed the customer to go to one of their "Direct Repair Shops" and had the car repaired properly. The insurance company promptly footed the bill and charged back the shop that did the repair originally.
As far as they don't get kick backs per say...a reduction in labor to me is a kick back...it just sounds a little more acceptable. That brings up another situation...what about the adjuster, tow truck driver or even the body shop themselves that do a similar thing. Adjuster's that get paid under the table for recommending shops...tow truck drivers that get paid under the table for taking a wreck to a certain compound or shop...the body shop that eliminates or reduces the deductable to get the job. In Canada, some provinces have Government Insurance...I wouldn't open a Body Shop in a Province with private insurance. The Government Insurance Provinces get between $15 and sometimes $20 more per flat rate hour, more for paint material per hour, more shop material per hour and there are no negotiated reductions in the hourly labor rate. Shops need to be certified in order to do work for the Insurance Company and training courses like ICAR etc. need to be kept up to date. The apprenticeship programs have students butts in the seats (not like some provinces with private insurance, why? Because the Body Shop gets paid more per hour and can pay their Techs an extra $7.50 or $10.00 per hour...that can be more than 20K a year for the good Tech). In a previous post I mentioned that a good painter gets on average $25 per hour flat rate...In provinces with Government Insurance, that same painter could get $35 per hour. Even if that painter only makes straight time he's paid over $70K a year and the painters that are fast and good...$100K is not out of the realm of possibility...a little on the rare side but I know of a few that get that pay cheque...and they earn it.
Used or aftermarket parts...again private insurance can do what they want....Government Insurance has semi annual meetings with their Body Shops to determine what is acceptable and what isn't along with hourly wage increases, shop safety requirements and staff training. The only thing that I think private insurance would do is require that staff be kept up to date with respect to training...they sure don't want to talk about hourly door rate increases, safety is pretty much regulated by the Government, the Insurance Company doesn't get involved and they demand that often the Body Shop install inferior parts.
Holy crap Brian...this forum is better than Jenny Craig...I think I just lost 5 pounds by getting all that off my chest...LOL