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AI comes to fix the car, and the body shops are not happy

AI comes to fix the car, and the body shops are not happy

Before At times, Jerry McNee wasn’t always a fan of appraisers. McNee is the president of Ultimate Collision Repair at the car repair shop in Edison, New Jersey. From his point of view, appraisers paid by insurance companies and claims adjusters typically want to pay less than their store deserves for repairs.

Since then Covid-19 around the world last year, McNee sees far fewer appraisers. Instead, insurers are using technology, photo-based calculations and Artificial intelligence. McNee misses his old rivals. “When the appraisers were here, face to face, you had a better relationship with them,” he says. “The appraiser knew you, he trusted you.”

The pandemic it has turned many businesses upside down. The car repair industry is a case study of the unexpected effects of technology that represents interactions between people.

Before the pandemic, more than 15 percent of U.S. car claims were settled using visits, they were fixed using photographs, says Bill Brower, head of Auto Claims at LexisNexis Risk Solutions ’data and analytics company. Now, it’s 60 percent, and it expects to reach 80 percent by 2025.

At the same time, insurance accelerated AI investment. Last year was “the year when AI actually crossed the line from being a novelty to a rule,” says Marc Fredman, head of strategy at CCC Information Services, which sells technology to insurance companies. The company says at least half of all claims involve some AI tool. Car insurance “isn’t necessarily what you’d assume would be very innovative and cutting-edge, but it is,” Fredman says.

There are changes to stay. Using AI and virtual estimates, “insurers have really seen an improvement in efficiency, consistency, and punctuality,” says Mark Friedlander, a spokesman for the insurance group’s industry group. Friedlander says the technology is not to replace human workers, but to help resolve claims more quickly and consistently. The technology has “created excellent results not only for insurance, but also for insurance,” he says. They are automatic claims made to the millennial set: fast and by phone, with as few back-and-forth calls as possible. According to the CCC, internal surveys show that 80% of customers who make photo claims find the process “attractive to browse”.

Tractable, the company that uses it computer vision and machine learning to build algorithms for insurance companies, he says 25% of his calculations are nose, that they don’t need human intervention. The company wants that figure to reach 75 percent by the end of the year, says Alex Dalyac, CEO and founder of Tractable.

One team is not happy with the results: the bodywork owners. “I would say 99.9% of the estimates are wrong,” says Jeff McDowell, owner of Leslie’s Auto Body in Fords, New Jersey. “You cannot diagnose photo suspension damage or a bent wheel or frame imbalance.”

Repair shop owners have said they spend much more time negotiating with insurance companies to determine the correct price for the repair, while they are not compensated. In some cases, this means that damaged vehicles are stuck in the store for longer than usual.

Incomplete estimates can lead to incomplete fixes. Motorists sometimes take vehicles to the Hernani Collision Repair to get the work done by other stores done properly. April Hernandez, a business with her family, says two of the company’s stores in southeast Georgia have seen poorer or more incomplete work during the pandemic. The change is attributed to photo-based calculations and AI applied during the process. “I feel like it’s getting worse as time goes on,” he says.

“A picture is worth a thousand words, but it’s not worth the damage,” says Mike LeVasseur, team leader for the Automotive Service Association, an industry trade group.

Virtual estimates work like this: Many major insurance companies require drivers who have had accidents to download an app. The app directs cars to take pictures at certain angles and at certain lights. Using only these photos, a claims adjuster calculates how much it will cost to repair the car.

Photo calculations make sense for insurers. Face-to-face, adapters can go to and inspect three to eight vehicles a day. With photos, adjusters don’t need a car or gasoline, just a computer, and they can do 15-20 calculations a day.

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