The largest vehicle glass repair and replacement businesses in the country says a Connecticut law passed last month is protectionist and will violate its constitutional right to free speech.
Safelite, which is based in Ohio and has 107 employees at eight Connecticut locations, has asked a U.S. District Court judge in Hartford to declare unconstitutional portions of An Act Concerning Automotive Glass Work and to issue a permanent injunction against the state’s enforcement of the provisions.
The company also filed complaints against Attorney General George Jepsen and Insurance Commissioner Thomas Leonardi.
The law, set to take effect Jan. 1, regulates how insurance claims administrators can recommend glass repair shops to policyholders.
Besides being a major auto glass replacement operation, Safelite provides third-party claims administration services to 18 of largest property and casualty insurers.
The law forbids claims administrators from telling customers that their insurer may not guarantee an out-of-network repairer’s work, even if it’s true.
Additionally, the law forbids a claims administrator from referring or directing a customer to a shop it owns unless it also provides the name of at least one additional glass shop in the area.
The provisions “restrict Safelite[’s] constitutional right to engage in truthful, non-misleading speech,” the complaint says.
Safelite says it’s one of two such out-of-state companies doing business in Connecticut, and alleges the law was aimed specifically at reducing its market share in favor of smaller, local companies.
Safelite’s relationships with insurers have meant that it can effectively self-refer policyholders to one of its affiliated repair shops, though it is illegal to require any customer to go to a specific shop. Additionally, Safelite said in its complaint that policy holders who call with glass claims are informed of the relationship between Safelite’s claims and repair businesses, and that they have the right to choose any repair shop they wish.
“At no time does Safelite Solutions or any of its insurance provider clients require the policyholder to have the work performed at a particular shop, and always honors the policyholders’ preference,” the filing claims.
If a policyholder doesn’t express a preference, the customer service representative will recommend a repair shop in accordance with the insurer’s glass program. Safelite said many, though not all, policyholders choose one of its repair shops.
Jepsen and Leonardi have until next week to respond to a summons.
