How Does Your Shop Charge Insurers for ADAS Scans? Insights from a Survey of Over 700,000 Social Media Followers

In today’s rapidly evolving automotive industry, Advanced Driver Assistance Systems (ADAS) have become a staple in modern vehicles. These systems, which include features like lane-keeping assistance, adaptive cruise control, and automatic emergency braking, require precise calibration and scanning to ensure they function correctly. Given the importance and complexity of ADAS, shops face significant decisions regarding how to charge insurers for these essential services. To gain insights into this topic, CmySkills conducted a survey among our over 700,000 social media followers, asking how their shops charge insurers for ADAS scans.

Survey Overview

The CmySkills survey revealed two primary approaches to charging insurers for ADAS scans:

1. Flat rate per scan/scan type (OEM/AM) – 61%

2. Negotiated rate per scan/scan type (OEM/AM) that differs by insurer – 39%

Analysis of the Survey Results

Flat Rate per Scan/Scan Type (61%)

A significant majority (61%) of respondents indicated that their shops charge a flat rate per scan or scan type, whether it’s Original Equipment Manufacturer (OEM) or Aftermarket (AM). This approach offers several advantages:

– Simplicity and Transparency: A flat rate system is straightforward, making it easier for shops to communicate pricing to insurers. This transparency can build trust and streamline the billing process.

– Predictability: For both shops and insurers, flat rates provide a predictable cost structure, which can simplify budgeting and financial planning.

– Efficiency: This method can reduce administrative burden since there is no need to negotiate rates for each insurer or adjust pricing frequently.

However, this approach may have some drawbacks, particularly if the flat rate does not adequately cover the cost variations associated with different scan types or complexities.

Negotiated Rate per Scan/Scan Type (39%)

On the other hand, 39% of respondents reported that they negotiate rates per scan type with each insurer. This method allows for more flexibility and potential customization based on specific circumstances:

– Tailored Pricing: Negotiating rates allows shops to tailor pricing based on the specific needs and agreements with each insurer. This can lead to more accurate compensation for complex or high-cost scans.

– Potential for Higher Revenue: Shops may be able to secure higher rates for more complicated or time-consuming scans through negotiation.

– Competitive Advantage: Offering negotiated rates can set a shop apart by demonstrating a willingness to work closely with insurers to meet their needs.

However, the negotiation process can be time-consuming and may require significant administrative resources. Additionally, it can lead to inconsistent pricing, which might confuse insurers or lead to disputes.

Summary and Conclusions

Our survey indicates that a majority of shops prefer the simplicity and predictability of charging a flat rate per ADAS scan or scan type. This approach facilitates clear communication and straightforward billing processes, benefiting both shops and insurers.

However, a significant portion of shops value the flexibility and potential financial benefits of negotiating rates with each insurer. This method allows for tailored pricing that can better reflect the complexity and cost of different ADAS scans.

Ultimately, the choice between these two approaches depends on the specific needs and capabilities of each shop. Some may prioritize simplicity and efficiency, while others may opt for the potential financial benefits and competitive differentiation that negotiated rates can offer.

Recommendations

1. Evaluate Your Shop’s Needs: Consider the administrative capacity, financial goals, and relationships with insurers when choosing a pricing strategy for ADAS scans.

2. Communicate Clearly with Insurers: Whether using flat rates or negotiated rates, clear communication with insurers is essential to ensure understanding and avoid disputes.

3. Stay Informed: Keep abreast of industry trends and adjust pricing strategies as necessary to remain competitive and ensure fair compensation for ADAS scanning services.

By understanding and strategically choosing how to charge insurers for ADAS scans, shops can better manage their operations, improve financial outcomes, and enhance their relationships with insurers.

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