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US Justice Dep't Must Investigate Auto Insurance Scam Allegations – Senator

© Flickr / Sean_MarshallThe US Department of Justice must investigate allegations that automobile insurance companies are pressuring repair shops to use low-quality parts, US Senator Richard Blumenthal said in an open letter to US Attorney General Eric Holder.
The US Department of Justice must investigate allegations that automobile insurance companies are pressuring repair shops to use low-quality parts, US Senator Richard Blumenthal said in an open letter to US Attorney General Eric Holder. - Sputnik International
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US Senator Richard Blumenthal wrote an open letter to US Attorney General Eric Holder, urging the US Department of Justice to investigate allegations that automobile insurance companies are pressuring repair shops to use low-quality parts.

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WASHINGTON (Sputnik) — The US Department of Justice must investigate allegations that automobile insurance companies are pressuring repair shops to use low-quality parts, US Senator Richard Blumenthal said in an open letter to US Attorney General Eric Holder.

“I urge the Department of Justice (DOJ) to immediately investigate such practices by the auto insurance industry and act swiftly to protect the safety of consumers and preserve competition in the auto repair industry,” the letter, which was released Friday, said.

The letter followed a CNN investigation alleging that automobile insurance companies pressure repair shops to use low-quality parts in order to save money for insurers. Shops that agree to use cheaper parts are placed on insurance companies’ lists of recommended providers, helping them attract customers, according to CNN.

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Blumenthal explained that such practice jeopardizes consumer safety. “As junk yard, remanufactured, and used parts of substandard quality become increasingly widely available, auto insurers are adopting alarming new ways to save money at the expense of consumer safety,” he said.

More than 500 repair shops from 36 states are suing top insurance companies, according to CNN.

Insurance companies deny the charges, saying their customers are free to use any shop they wish.

There are 786 cars per 1,000 people in the United States, according to the World Bank.

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