Industry publications frequently discuss the timesaving aspects of electronic communication. In fact, it's highlighted to great effect here on "Lines of Convergence," illustrating its effect on the direct repair program process. Recent events have highlighted another integral benefit of using electronic communication—utilizing CCC's claims database to address industry concerns, such as recalls.

We utilize data captured in our vehicle claims data warehouse to help facilitate communication between the automobile insurance and collision repair industries. We have been capturing data from vehicle appraisals and total loss valuations for many years, including detailed claim, vehicle, customer, parts, labor, cycle time and claims cost information. From this data, we can quickly retrieve all pertinent claims information on specific vehicles where there may have been, for example, a recall or a price discrepancy.

The year 2004 serves as an excellent model to validate the data's importance. In 2004, National Highway Traffic Safety Administration (NHTSA) data revealed a huge surge in the number of vehicle recalls for the year; 598 recalls involving a record 30.6 million U.S. cars and trucks.

Prior to last year, the record number of recalls was 541, which impacted 24.6 million vehicles in 2000.ⁱ As automakers race to introduce more new models each year that incorporate more bells, whistles and electronic gizmos to entice new customers, the number of recalls is growing.

Another factor driving recalls is the Transportation Recall, Enhancement, Accountability and Documentation (TREAD) Act, a federal law that was passed in 2000 in response to the Ford/Firestone tire issue, which calls for automakers to more proactively report problems as they are reported or revealed. With NHTSA serving as the rulemaking authority for the law, the TREAD Act requires automakers to report on 24 different categories, including air bags, brakes, electrical system, engine and cooling system, exterior lighting, fuel systems, latching, powertrain, seats, steering, structure, suspension and wheels.

There are two ways CCC's data can provide a benefit to its customers. The first is that we're constantly working to proactively provide customers with information on vehicle recalls. For example, when the NHTSA recall database is updated monthly, the pertinent information on affected vehicles is incorporated into each total loss valuation response and the vehicle tab within CCC Pathways® collision estimating. With that recall information in hand, the adjuster/appraiser can determine whether the recall played a role in an accident.

Secondly, we can provide customers with a monthly detailed listing of their claims that have already taken place, including: the vehicle owner's name and contact information; vehicle information down to year, make, model, body style, door style, engine and color, and; related claims information such as coverage, policy and claim numbers, claim office and appraiser information.

At that point, customers can review their claim files to help determine whether the recall in question may have contributed to the cause of loss in some manner. These claims can then be sent to a subrogation unit for further follow-up.

The following are some examples of recent recalls/parts issues:

1. CCC pulled 995 vehicle appraisals featuring 2001-2003 Hyundai Elantra's with aftermarket hood replacements (recall on outsourced Yih Sheng Auto Parts Ind. Co. hoods made between December 2003 and May 2004 with potentially faulty latch assemblies).ⁱⁱ
   
2. More than 11,000 vehicle appraisals on '96-'04 Ford Taurus and '99-'04 Pontiac Grand Am models with aftermarket headlamps from Keystone Automotive (in response to Keystone's voluntary suspension of the sale of its aftermarket headlamps for these models) were pulled by CCC.ⁱⁱⁱ
   
3. CCC was able to find more than 56,000 vehicle appraisals on 2002-2004 Chrysler minivans with V-6 engines with primary or secondary impact points designated some type of burn (in response to the recall in August 2004 by Chrysler).^iv

A more recent example is a situation where CCC was able to identify, address and rectify parts pricing discrepancies in our data for the 2002-2005 Dodge Ram 1500. Since the issue came to the fore just 24 hours after mailing our monthly CCC Pathways data CD, we proactively contacted customers and made them aware that we had implemented dedicated telephone and e-mail lines for quick response to any needs they may have had.

We were in many cases able to reach customers prior to receipt of the update CD. Additionally, we continue to run weekly data audits looking for estimates created for this vehicle and will proactively notify the creator of these estimates and assist them in implementing the corrective action if the discrepancy exists.

Susanna Gotsch is director of analysis and reporting at CCC Information Service Inc. and author of Crash Course.

1. “Carmakers Staggered by Record '04 Recalls.” Source: The Detroit News, January 4, 2005. nadaheadlines@nada.org.
2. “Yih Sheng Recalls Aftermarket Hoods for Possible Latch Failure.” CollisionWeek, Monday, January 10, 2005.
3. Keystone Suspends Sale of Two Aftermarket Headlamps.” CollisionWeek, Friday, October 15, 2004.
4. “Chrysler to Recall 831,000 Minivans.” Source: The Associated Press, nadaheadlines@nada.org, August 5, 2004