ABAT Webinar Addresses RTA, Copays and Labor Rate Reductions
by Alana Quartuccio
When it comes to guiding the Texas collision repair community through daily trials and tribulations, ABAT never fails to hear the call.
Setting the tone for the upcoming new year with fresh goals, ABAT held one final webinar for 2025 at the end of December to address the growing concerns surrounding labor rate reductions, informing the ABAT community about how invoking the Appraisal Clause and implementing copays can help shops in the fight. They also set out to update the membership on the rulemaking behind the mandatory Right to Appraisal (RTA) legislation, which was a huge victory for the association in 2025.
“Over the past several months, I’ve received several emails and phone calls from shops across the state about labor rate reductions,” shared ABAT Executive Director Jill Tuggle, who explained, as an association, it isn’t always easy to figure out the best way to address this in a way that abides by the law and equips shops with the proper tools to fight this issue. She said a “resounding response” from the Board centered on customer copay and RTA. While those who have been implementing customer copays are not feeling the effects of labor rate reductions and those who have not are, Tuggle suggested, “The good news is it’s not too late to consider these avenues, so you and your customer can be made right by the insurance company.”
“ABAT is focusing on our members, and we do what we can as an association to help shops be successful and be more profitable,” offered ABAT President Burl Richards. He stressed that RTA is a tool that has worked very well for his business but understands every shop is different. “It’s not cookie cutter. Every shop is in a different market. Every shop has to decide how to run and manage their business. That’s the reason we have ABAT. We don’t have all the answers. We get the answers from our members when you tell us your success. I always say it’s not bragging if you can back it up.
“We’d love to hear your success stories,” he encouraged members. “More than ever, insurance companies are fighting back, not just on the labor rate, but with parts, and it’s going deeper down the hole.”
ABAT welcomed Robert McDorman (Auto Claim Specialists), a licensed public insurance adjuster who was instrumental in the fight for mandatory RTA, to update the ABAT community on what is to be expected from the newly passed law and how the RTA process works.
“It’s always been my position to educate customers as it goes a long way,” suggested McDorman. “The shop is owed what it is owed. The better job we do at giving customers information, the better they can handle the situation when there is a short pay.”
RTA sets out to “level the playing field” when a dispute over the loss arises. McDorman reminded all that once it’s invoked and an agreement is reached, it’s binding so “when a customer invokes RTA, it’s best to wait until the repairs are completed before agreeing to anything.”
He shared his involvement with the rulemaking process as he was invited to submit suggestions to TDI which included adding time-triggers to reduce the length of the process. In his experience, the RTA process has taken as many as 280 days, “which is absolutely crazy.”
Although the final draft of the rules were not in at the time of the webinar, McDorman was hopeful that TDI would reconsider reducing the maximum time frame of 180 days down to his preferred suggestion of 90 days.
He stressed what an important win this was for the Texas consumers and the collision repair industry as both sides of the aisle passed the bill in the legislature. “I think we can all agree that both sides of the aisles don’t agree on anything, but they unanimously agreed on this. It took many years of proving and fact finding to get everyone at the Capitol to see the problem.
“It’s my position that the appraisal process is the insured’s best tool to be properly indemnified. The best thing a shop can do for their client is to let them know about it. If handled properly, all the customer should have to pay is their deductible.”
Shops base their repair methodology on OEM requirements, while insurance companies base theirs on cost savings and will go into “defense mode,” so it’s crucial to have a transparent and upfront conversation about this so customers know what to expect.
“We start right on the front end to let them know what is going to happen,” shared Richards. “We’ll show them the OEM requirements and prepare them to expect the insurance company to come back offering typically 50, 60 or 70 percent less than what the repair plan says. Because we already set the stage with the customer, they see the situation, and then we let them know of their options – that they can take it somewhere else and repair it the way the insurance company wants…or we can repair it the way the manufacturer recommends. I am going to say 99 percent, even though I can’t think of one percent that didn’t do it, so we’re probably batting 100 percent of every customer who invoked their Right to Appraisal.”
It’s been his business model to continue on with the repairs if a customer invokes the RTA.
“Educating the customer upfront and proving to them during the process that what you said is true is proven by documentation. That overwhelmingly trumps anything the insurance company may say.”
Basically, Richards finances these customers’ repairs upfront by paying his technicians and ordering the parts. “Getting reimbursed for everything you did is a great feeling. Profitability takes care of itself on the backend, but you will get reimbursed for everything you did,” he said, adding that he is sure to include everything that was required in the repair like test driving and pre-washing the vehicle. He realized he didn’t even have to fix as many cars in order to be profitable.
McDorman stressed what drives him in the fight for RTA is safety. “I testified that we won’t charge every client that comes to our door,” he noted of waiving his firm’s fee if someone in need of safe repairs truly can’t afford it. “My heart is so committed to this.”
The new appraisal law that requires all insurance companies to include the Appraisal Clause went into effect January 1; however, McDorman pointed out that insureds won’t see it in their policy until July 1.
Tuggle shared details about upcoming events, including the return of ABAT’s Ladies Night of Honor Event, taking place in Lubbock on February 12, and an “Unleashing the Power of CCC One” seminar featuring Mike Anderson (Collision Advice) in Houston on March 5.
More information on ABAT events can be found by visiting abat.us.
Want more? Check out the February 2026 issue of Texas Automotive!