DOBI’s Game of Telephone: Insurers Whisper, Regulators Repeat
by Chasidy Rae Sisk
Remember when we were all kids, and sitting around in a circle, we’d whisper a message to the next person over? Bit by bit, that message would get pretty convoluted, and often, the last person in line would convey something that made no sense at all.
That often seems to be the case when dealing with the New Jersey Department of Banking and Insurance’s (DOBI). Yet, while it may feel like a game of “telephone” from a shop perspective, DOBI’s method of conveying insurance companies’ responses is more akin to “repeat after me,” mimicking exactly what the insurer says without any consideration to the logic behind it.
Late last year, we saw this game play out in DOBI’s rejection of data provided by a collision shop while rubberstamping Allstate’s insistence that they were paying a “fair and reasonable amount” (check it out at grecopublishing.com/nja1125coverstory), but that’s only one example of the organization’s tendency to engage in pretend play when it comes to supporting insurers.
A similar situation arose at DJ’s Restoration (Trenton) after a client’s 2025 Toyota sustained damage on July 14, 2025. During Allstate’s inspection the following week, the adjuster wrote an estimate of $2,161.61, and when the shop inquired about reimbursement for paint blends and calibrations on the blind spot radar, Allstate indicated they would need proof of completion of the blends and documentation of the calibrations to consider payment. A couple days later, DJ’s Restoration submitted a supplement for additional damage discovered. Allstate issued payments for their initial estimate (less the customer’s deductible) and an additional $1,500.45 for the supplement.
But then things went sideways. On August 12, the shop submitted photos and a $800.17 supplement for the refinishing materials for blending and buffing, and though Allstate remitted partial payment for the supplement, their estimate excluded finish sand and buff labor time as well as the additional time needed for blending on the rear body panel. Another inspection and additional correspondence followed, culminating in Allstate’s claim that “payment for paint materials was included in the supplement and based on the allowed refinish time” [emphasis added].
During a final inspection in September due to shop owner Danny Brandt’s persistence on the matter, Allstate determined that no additional payments were warranted as previous compensation had included “paint materials based on the allowed refinish times.”
This timeline was relayed by DOBI Supervisor of Investigations Robert Palentchar after Brandt filed a complaint for unsatisfactory reimbursement. “After considering all available information, Allstate processed your client’s claim in accordance with the policy and consistent with state insurance regulations, none of which mandates the use of specific repair cost calculators or provide a repair fee schedule,” Palentchar wrote on October 2.
In response, Brandt sought clarification regarding DOBI’s statement regarding insufficient refinish materials, noting, “For this claim and all others, we use the Mitchell estimating refinish material calculator, which determines the material amount based on the paint code and refinish time. This system cannot be altered and is designed to ensure a reasonable and sufficient cost for these materials.
“Allstate remains one of the few insurance companies not covering RMC, instead only paying for refinish time multiplied by an archaic hourly rate,” he pointed out, referencing DOBI’s 2007 Bulletin No. 07-20, which acknowledges “the methods utilized by several insurers to provide allowances for paint and material costs are in some instances out of date […] the actual costs of paint and materials have increased over time and some insurers’ allowances to do not reflect the actual cost of the paint and/or material.”
Bulletin 07-20 further indicates that some insurers’ traditional methods may be “inadequate or recessive, resulting in repair estimates that do not provide a sufficient allowance to restore the vehicle to its condition immediately prior to the loss. Insurers are expected to provide repair allowances that are sufficient to restore damaged vehicles to their pre-accident condition. The use of available paint and materials cost calculator manuals and programs to determine allowances is encouraged to assist insurers in achieving consistent compliance.”
Brandt’s email lamented that, due to situations like this one, “the customers’ best interests are being overlooked in favor of the insurance company by approving a claim where the customer had to pay the difference for something their insurance should cover.”
Surely, such a heartfelt concern, paired with the department’s own documentation, would affect DOBI’s stance? Although Palentchar expressed appreciation for Brandt’s position, he insisted, “There are no state insurance regulations mandating the use of a specific repair and/or paint cost calculator or any such calculators for that matter. In addition, the Department Bulletin you provided (07-20) simply encouraged but did not mandate the use of these calculators. Therefore, Allstate is free to utilize its own cost calculator, system or market data, including from its network of repair facilities, for estimating repair and paint costs and reimbursement.”
Appalled by DOBI’s indifference to their own admission that the use of an “archaic hourly rate” works against policyholders’ best interests, Brandt reached out to New Jersey Automotive to spread awareness of this prevailing issue. “DOBI dismissed their own bulletin, stating that there are no state regulations mandating these calculators; it’s simply a recommendation, so they don’t have to abide by it apparently.
“The bigger problem lies in the fact that it seems like DOBI simply rubber-stamps whatever the insurance companies say without any proof or documentation,” Brandt observes. “They don’t have to show anything to justify their statements, yet shops have to show everything we do, which isn’t a problem since we have nothing to hide. In this case, we provided documentation through RMC which calculates based on the estimate and paint hours, yet once again, they summarily dismiss our solid documentation. But even when we provide invoices to prove price changes, insurers still don’t want to pay the difference. Then it all falls on the vehicle owner to pay the difference, so the consumer pays the price for the insurers’ behavior.”
AASP/NJ Collision Chairman and Past President Jerry McNee weighs in on the matter. “It’s no secret that much of DOBI’s staff has either come from or is headed to positions within the insurance industry, and DOBI’s advisory board is made up entirely of insurance personnel. Publicly traded insurers like Allstate continue to post strong profits, and the data for 2024 and 2025 clearly shows that. Meanwhile, New Jersey drivers already pay some of the highest rates in the country, while regulators turn a blind eye – hear no evil, speak no evil, see no evil. That’s the reality.”
McNee recounts a recent meeting with another insurer’s manager regarding a $6,000 shortpay. “He was cold as ice – brushed off every fact and told me to take it up with DOBI and the legislature. He even cited DOBI’s support for removing the Right to Appraisal (RTA) from their policy and seemed to take great pride in that protection as justification. His exact words were, ‘The client will pay the difference,’ proving that insurers are completely comfortable with leaving customers to figure it out on their own. When I asked about the experience level of their appraisers, he simply replied that they’re ‘trained to write estimates.’ But when I asked what about repairing vehicles correctly, he sat there stone-faced – no answer.
“So, is DOBI truly concerned about New Jersey consumers or the real harm this approach causes?” McNee asks. Well, the answer seems obvious, despite their perfunctory responses which are apparently a mere part of the game.
Want more? Check out the January 2026 issue of New Jersey Automotive!