NU Online News Service, July 14, 3:01 p.m. EDT
A Western-based independent insurance agents' group is protesting a program where buyers of new GM automobiles receive a one-year auto-insurance policy at no extra cost through MetLife.
The Professional Insurance Agents Western Alliance says it is opposing the program that gives an auto-insurance policy to buyers or leasers of any new Chevrolet, Buick, GMC or Cadillac car, truck or crossover for one year.
PIA Western Alliance Executive Vice President Clark Sitzes says in a statement that the group is concerned that business is being taken away from independent agents through a program that may not be legal.
He says the program "smacks of rebating," which is illegal, because something is being given for free in exchange for the purchase of something else.
Sitzes also raises issues with whether GM sales associates are acting as agents in selling both the car and insurance program—clearly a violation of the law.
He also raises issue with anti-discrimination laws, saying that if the price auto buyers pay for their policies differs from what other MetLife customers pay, that may constitute discrimination.
"Consumers utilize licensed, professional independent insurance agents to provide them with a range of insurance options, counsel them, assist them in coordinating coverages and advocate for them," says Sitzes.
The GM program, which was launched in Oregon and Washington, may be rolled out more widely in the future. Sitzes says the program has received permission to be marketed in 17 states.
Under the program, buyers of GM autos are offered an auto-insurance policy that covers damage to the car for one year. The auto maker picks up the premium for liability, collision and comprehensive coverage.
Those who decide not to go with the program do not receive a discount on their automobile.
The PIA Western Alliance, which represents agents in nine states, says it is working with regulators in all of the states to determine the legality of these programs.
A representative from MetLife was not immediately available for comment.
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