New York body shop laws: what insurers and shops must do

What it means in New York

When an insured has a collision or comprehensive loss, the insurer can't require a particular shop, and can't recommend or suggest one unless the insured asks. Its estimate must tell the insured in print that they can have the car fixed at the shop of their choice. The recommendation limit and the estimate notice don't apply to glass-only claims. A 2002 decision by New York's highest court read the rule as restricting recommendations of particular shops, not the insurer promoting its repair program.

Circular Letter 16 (2000), which told insurers they could recommend shops, was withdrawn effective December 4, 2003 and should not be relied on. New York's highest court, in Allstate v. Serio (2002), read the rule as restricting recommendations of particular shops, not an insurer's promotion of its repair program.

The law's own words

“no insurer providing collision or comprehensive coverage therefor shall require that repairs be made to such vehicle in a particular place or shop or by a particular concern.”

N.Y. Ins. Law 2610, revised 6/23/2017

“In processing any such claim (other than a claim solely involving window glass), the insurer shall not, unless expressly requested by the insured, recommend or suggest repairs be made to such vehicle in a particular place or shop or by a particular concern.”

N.Y. Ins. Law 2610, revised 6/23/2017

“AN INSURANCE COMPANY CANNOT REQUIRE THAT REPAIRS BE MADE TO A MOTOR VEHICLE IN A PARTICULAR PLACE OR REPAIR SHOP. YOU HAVE THE RIGHT TO HAVE YOUR VEHICLE REPAIRED IN THE SHOP OF YOUR CHOICE”

N.Y. Ins. Law 2610, revised 6/23/2017

What it means in New York

No rule in our New York collection requires the insurer to pay storage or give notice before it stops; the state's claim rule, 11 NYCRR 216.7, has no storage provision. You can't charge storage unless you've told the customer in writing, such as a line on the estimate. No storage can run from when the customer authorizes repairs until one business day after you tell them to pick it up. If you gave a written estimate, your lien can't exceed it.

No rule in our New York collection requires an insurer to pay storage or give notice before it stops; 11 NYCRR 216.7 has no storage provision. Lien Law notice deadlines for owners and lienholders apply to police-requested tows.

The law's own words

Shop

“However, if the bailee of a motor vehicle, motor boat or aircraft has furnished a written estimate of the cost of towing, storage, maintenance, repair or any other service on such motor vehicle, motor boat or aircraft, any lien sought by such bailee for such service may not be in an amount in excess of the written estimate.”

N.Y. Lien Law 184, revised 9/22/2014

Shop

“A customer may not be charged for storage unless notice in writing is given. Notice may be given by a statement on an estimate or other document given the customer, by letter or by other written means which gives the customer actual notice.”

15 NYCRR 82.8, CR-82 (5/26) (PDF)

Shop

“Storage may not be charged during the period from which the customer has authorized repairs to one business day after the repair shop has notified the customer to pick up the repaired vehicle.”

15 NYCRR 82.8, CR-82 (5/26) (PDF)

What it means in New York

You can hold the car until you're paid, but your lien can't exceed your written estimate. If you let the car go more than 30 days after the lien arose, the lien is void against any earlier lender, even if you get the car back. To sell, serve your customer and every lender on the title a notice giving at least 10 days to pay and naming the sale's time and place, then sell at public auction. Within 10 days, your customer can ask a court to rule on the lien; anyone notified can redeem before the sale by paying the lien plus costs.

An unregistered repair shop gets no lien. In the Lien Law 201-a proceeding the owner gets the car back only if the court cancels the lien; anyone entitled to notice may redeem before sale by paying the lien and costs (Lien Law 203).

The law's own words

Keep the car

“has a lien upon such motor vehicle, motor boat or aircraft for the sum due for such towing, storing, maintaining, keeping or repairing of such motor vehicle, motor boat or aircraft or for furnishing gasoline or other supplies therefor and may detain such motor vehicle, motor boat or aircraft at any time it may be lawfully in his possession until such sum is paid,”

N.Y. Lien Law 184, revised 9/22/2014

Keep the car

“However, if the bailee of a motor vehicle, motor boat or aircraft has furnished a written estimate of the cost of towing, storage, maintenance, repair or any other service on such motor vehicle, motor boat or aircraft, any lien sought by such bailee for such service may not be in an amount in excess of the written estimate.”

N.Y. Lien Law 184, revised 9/22/2014

Sell or title it

“It shall also require such owner or any such person to pay the amount of such lien, on or before a day mentioned therein, not less than ten days from the service thereof, and shall state the time when and place where such property will be sold, if such amount is not paid;”

N.Y. Lien Law 201, revised 9/22/2014

Sell or title it

“Each sale of personal property of a value of one hundred dollars or more, or of any security, to satisfy a lien thereon shall be at public auction to the highest bidder, and shall be held in the city or town where the lien was acquired.”

N.Y. Lien Law 202, revised 9/22/2014

Challenge in court

“Within ten days after service of the notice of sale, the owner or any person entitled to notice pursuant to section two hundred one of this article may commence a special proceeding to determine the validity of the lien.”

N.Y. Lien Law 201-A, revised 9/22/2014

What it means in New York

In New York, if the insurer's estimate uses non-OEM crash parts, it must name the parts maker or supplier and can't use more than three suppliers per repair without the insured's consent. The parts must equal or beat OEM in fit, form, finish, quality and performance, with at least OEM's warranty. If the parts maker won't honor it, the insurer must restore the car at no extra cost to the insured. Your estimate and invoice must say whether body parts are OEM, non-original or used.

The 11 NYCRR 216.7 parts rules sit in the section on adjusting partial losses on the insured's own vehicle; where a part has been certified by an approved certifying entity, the insurer may specify only certified parts. The estimate and invoice labeling rule in Vehicle and Traffic Law 398-D covers vehicles with a gross vehicle weight of 18,000 pounds or less.

The law's own words

Shop

“If any body parts are included in the estimate for a vehicle with a gross vehicle weight not in excess of eighteen thousand pounds, the estimate shall clearly state whether such parts were manufactured as original equipment parts for the vehicle, or were manufactured as non-original replacement parts or are used parts.”

N.Y. Veh. & Traf. Law 398-D, revised 9/22/2014

Insurer

“(5) If the insurer's repair estimate is based upon the use of any non-OEM crash part: (i) the estimate shall specify the non-OEM or non-OEM supplier; (ii) the insurer shall not, without consent of the insured or the insured's designated representative, specify non-OEM crash parts from more than three different suppliers for any one repair;”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Parts standard

From a list that begins: “If the insurer's repair estimate is based upon the use of any non-OEM crash part:”

“(iii) the crash part shall equal or exceed the comparable OEM crash part in terms of fit, form, finish, quality and performance; (iv) the crash part must be warranted by the non-OEM at least to the extent and duration as the comparable OEM crash part;”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Parts standard

From a list that begins: “If the insurer's repair estimate is based upon the use of any non-OEM crash part:”

“(vi) if the crash part has not been certified by a qualified certifying entity acceptable to the superintendent, the non-OEM must issue a written warranty, for at least the period of the insured's ownership of the vehicle, that the crash part equals or exceeds the comparable OEM crash part in terms of fit, form, finish, quality and performance; and”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Insurer

From a list that begins: “If the insurer's repair estimate is based upon the use of any non-OEM crash part:”

“(vii) the insurer shall cause the damaged vehicle to be restored to its preloss condition consistent with the non-OEM warranty, at no additional cost to the insured and within a reasonable time, if the non-OEM fails to honor its warranty required in subparagraph (iv) or (vi) of this paragraph.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What it means in New York

New York has no law requiring an appraisal clause or setting appraisal rules for auto claims. On your customer's own claim, the insurer must negotiate in good faith toward an agreed price with your customer or their designated representative. If no price is agreed, it must send the Notice of Rights letter and, on request, name a registered shop nearby that will repair at its estimate. A 2001 Department guidance opinion says a policy may include an appraisal clause limited to the amount of loss.

The Regulation 64 text (11 NYCRR Part 216) comes from the LII mirror, not the official publisher. If your shop isn't your customer's designated representative, a price you agree with the insurer doesn't bind your customer. The OGC opinion is a 2001 informal opinion (guidance); its current Department treatment is not certified. The Notice of Rights requirement does not apply to claims solely involving window glass.

The law's own words

Other dispute rules

“(7) Negotiations must be conducted in good faith, with the basic goal of promptly arriving at an agreed price with the insured or the insured's designated representative. If the insured's intended repair shop is not a designated representative of the insured, the insurer may also reach an agreement with that repair shop on the cost to repair the damaged vehicle, but that agreement shall not be binding upon the insured or the designated representative.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Other dispute rules

“(i) If after negotiations an agreed price cannot be reached, the insurer must furnish the insured with a prescribed Notice of Rights letter (NYS APD 1), contained in section 216.12 of this Part.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Other dispute rules

“(ii) The insurer must furnish the insured or the designated representative, at the express request of either, with the name and address of a New York State registered motor vehicle repairer, properly equipped to complete the repairs on the damaged motor vehicle (back-up shop), at a location reasonably convenient to the insured, who will repair the damaged motor vehicle at the insurer's estimated cost of repair.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Other dispute rules

“(a) In any case where there is no dispute as to coverage, it shall be the duty of every insurer to offer claimants, or their authorized representatives, amounts which are fair and reasonable as shown by its investigation of the claim, providing the amounts so offered are within policy limits and in accordance with the policy provisions.”

11 NYCRR 216.6, effective 6/9/2021 (Cornell LII copy)

How appraisal works

“The insurance policy may contain an appraisal clause which specifies that where the insured and the insurer disagree as to the amount of the loss, the matter will be submitted for an appraisal. See, eg., N.Y. Ins. Law § 3404 (McKinney 2000). Significantly, arbitration differs from an appraisal in that arbitration disposes of the entire controversy between the parties, whereas an appraisal is limited to deciding the collateral matter of the value of the loss.”

N.Y. DFS guidance: OGC 01-02-09 Motor Vehicle Adjuster Activities (agency guidance, not a statute or rule)

What it means in New York

New York has no labor rate survey law. As a general business practice, the insurer can't artificially lower cost data used to adjust claims or use cost data that doesn't fit the region of the loss. On your customer's own collision or comprehensive claim, if it inspects first, it must make a good faith offer enough to repair the car within six business days, negotiate in good faith toward an agreed price, and on request name a shop that will repair it for its estimate.

Section 216.7 covers collision and comprehensive claims, and its text comes from the LII mirror, not the official publisher. Section 2601 practices count only when committed without just cause and often enough to be a general business practice; each violation can draw a monetary penalty, and a violation is not a misdemeanor. If the insured designates your registered shop in writing as the designated representative, you can negotiate the repair amount on the insured's behalf.

The law's own words

What the insurer pays

From a list that begins: “Any of the following acts by an insurer, if committed without just cause and performed with such frequency as to indicate a general business practice, shall constitute unfair claim settlement practices:”

“artificially deflating or otherwise lowering cost data used for adjusted claims, or using cost data that is not appropriate for the region of the state where the loss occurred;”

N.Y. Ins. Law 2601, revised 1/4/2019

What the insurer pays

“In addition, negotiations shall commence and a good faith offer of settlement, sufficient to repair the vehicle to its condition immediately prior to the loss, shall be made within the aforesaid six-day period to the designated representative”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Related claim rule

“Negotiations must be conducted in good faith, with the basic goal of promptly arriving at an agreed price with the insured or the insured's designated representative.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Related claim rule

“Each item of damage must be detailed as to the paint, parts and labor hours it will require to repair that particular item. If the appraisal is made at a repair shop, the registration number of the shop must be included on the estimate form.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What the insurer pays

“The insurer must furnish the insured or the designated representative, at the express request of either, with the name and address of a New York State registered motor vehicle repairer, properly equipped to complete the repairs on the damaged motor vehicle (back-up shop), at a location reasonably convenient to the insured, who will repair the damaged motor vehicle at the insurer's estimated cost of repair.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What it means in New York

New York has no rule on paint and materials caps, but it sets paint rules for the insurer's estimate. Each damaged item must show its paint, parts and labor hours, plus a separate paint-waste disposal line: your cost per paint hour times the estimated paint hours, capped at the local prevailing cost. The insurer can require your disposal manifest and invoice, and drop that line without them. Whether a materials cut is fair and reasonable is for the Department of Financial Services or a lawyer.

216.7 governs collision and comprehensive claims; under 216.10 its paint-waste and estimate-detail rules also apply to third-party property damage claims. The disposal cost can't exceed the prevailing cost in the area, and a new shop may use that prevailing cost in its first year. This text comes from the owner-approved LII mirror, not the official NYCRR publisher.

The law's own words

What the insurer pays

“(4) The insurer's repair estimate shall include, as a separate line item, the reasonable cost for proper disposal of waste material generated by painting the motor vehicle or crash part, in the following manner (or using another method that is acceptable to the superintendent as functionally equivalent):”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What the insurer pays

“(i) the cost per paint hour shall be calculated by dividing the repair shop's annual disposal fees for such waste material, after adjusting for reclaiming or recycling by the repair shop, by the number of hours expended annually to paint vehicles; (ii) the reasonable cost for proper disposal of the waste material shall be calculated by multiplying the number of hours estimated to paint the vehicle by the cost per paint hour;”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What the insurer pays

“(iii) presentation of the manifest and invoice documenting a repair shop's disposal and disposal cost for hazardous waste may be required by an insurer as a condition for this separate line itemization, and the failure of the repair shop to provide such documentation shall relieve the insurer from any consideration or inclusion of such disposal cost on an itemized basis within the repair estimate;”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

What the insurer pays

“Each item of damage must be detailed as to the paint, parts and labor hours it will require to repair that particular item.”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Related claim rule

“(a) In any case where there is no dispute as to coverage, it shall be the duty of every insurer to offer claimants, or their authorized representatives, amounts which are fair and reasonable as shown by its investigation of the claim, providing the amounts so offered are within policy limits and in accordance with the policy provisions.”

11 NYCRR 216.6, effective 6/9/2021 (Cornell LII copy)

What it means in New York

New York's rules bind the insurer. It must acknowledge a claim within 15 business days and accept or deny within 30 working days of a properly executed proof of loss. On collision and comprehensive claims, an insurer that wants to inspect has 6 business days from notice of claim to do it and to make a good faith offer to repair. Agreed settlements must be paid within 5 business days. The penalty is a Department fine per violation; no late-payment interest appears.

Third-party property damage claims under auto liability policies follow 11 NYCRR 216.10: acknowledgment or payment within 15 business days, a written offer or denial within 10 business days after the investigation ends, and a decision within six months of the notice of loss; the 5-business-day payment rule also applies to them. The 2601 penalties reach acts done without just cause and often enough to be a general business practice. The Part 216 text comes from the Legal Information Institute mirror, not the official publisher, so verify the current official text before relying on a deadline.

The law's own words

Accept or deny

“After receiving a properly executed proof of loss, the insurer shall advise the claimant of acceptance or denial of the claim within thirty working days;”

N.Y. Ins. Law 2601, revised 1/4/2019

If late

“If it is found, after notice and an opportunity to be heard, that an insurer has violated this section, each instance of noncompliance with subsection (a) hereof may be treated as a separate violation of this section for purposes of ordering a monetary penalty”

N.Y. Ins. Law 2601, revised 1/4/2019

Respond

“Every insurer, upon notification of a claim, shall, within 15 business days, acknowledge the receipt of such notice. Such acknowledgment may be in writing.”

11 NYCRR 216.4 (Cornell LII copy)

Accept or deny

“it shall have six business days following receipt of notice of claim to inspect the insured's damaged motor vehicle, which is available for inspection, during normal business hours at a place and time reasonably convenient to the insured. In addition, negotiations shall commence and a good faith offer of settlement, sufficient to repair the vehicle to its condition immediately prior to the loss, shall be made within the aforesaid six-day period”

11 NYCRR 216.7, effective 6/9/2021 (Cornell LII copy)

Pay

“Every insurer shall pay any amount finally agreed upon in settlement of all or part of any claim not later than five business days from the receipt of such agreement by the insurer, or from the date of the performance by the claimant of any condition set by such agreement, whichever is later,”

11 NYCRR 216.6, effective 6/9/2021 (Cornell LII copy)