CAR HISTORY REPORTS DON’T GIVE FULL PICTURE.
Every retailer of new or used autos, whether it’s a full-line manufacturer store or a small independent lot, advertises that all of their used vehicles come with full repair history reports from reputable agencies such as Carfax and CarProof. They do this to provide some assurance and evidence that their products haven’t been involved in any major collisions.
Consumers look for and depend on these reports because, as everyone knows, collision damage, no matter how well repaired, will negatively affect the perceived and real market value of an auto. But how reliable are these reports?
The biggest drawback with any type of collision-history reporting system is that it doesn’t track repairs paid for by the vehicle owner (rather than an insurance company) unless the body shop in question uploads the vehicle data to a shared network through their estimation/billing software.
Most people paying for their own single-vehicle collision damage (where no other party’s property was damaged) will ask the shop not to report this through their software supplier. A recent informal survey of area body shops indicated that roughly 15 to 20 per cent of the collision repairs they perform are paid out of the vehicle owner’s pocket without an insurance claim being created. Most shop managers agree this trend is growing.
Another major source of unreported collision repairs comes from large fleets. Car rental companies usually pay for their own vehicle damage (up to a specific limit) due primarily to large commercial deductibles and a revenue stream from fees charged to consumers. When one considers that rental vehicle fleets are a major source of pre-owned vehicle inventory for retailers, this widens the gaps in collision reporting nets.
So what’s a savvy car shopper to do?
You can start by asking your retailer for a written report from their own technicians and having this report’s findings included in any retail transaction agreement.
Consumer protection laws vary from province to province. Some use industry groups such as Ontario’s Motor Vehicle Industry Council. These organizations have jurisdiction over only the retailers that are licensed members.
Some provinces have specified damage limits before disclosure is required (for example in Manitoba a retailer does not have to disclose damage incidents below $3,000). Most provinces require the consumer to lodge a complaint before action is taken, and things are often settled in an arbitration process.
Changes in Ontario law in 2010 removed the onus of proving the retailer knew of prior damage if a consumer seeks compensation. You stand a much better chance of resolving a problem, no matter what province you’re in, if the sales agreement contains a clause detailing the condition of the vehicle.
If you have a regular service provider, consider having them complete a pre-sale inspection. This can remove any questions about the vehicle’s condition as well as providing some idea of future maintenance requirements.
While the open market for used vehicles may be affected by collision damage and repair history, it’s pretty much silent on the topic of warranty repairs.
If you’re shopping for a pre-owned vehicle at an authorized dealer that sells the same nameplate, ask for a warranty repair summary. All carmakers maintain this database and it’s easily retrieved by their dealerships.