Whether it's your home or whether it's your car that has been damaged, most insurance companies have made arrangements with repair facilities and/or contractors for materials and labor rates that are often lower than prevailing rates in your community. The obvious attraction to the "preferred" contractor is that they agree to charge less in exchange for receiving a large volume of business from the insurance company in question. Most companies have established buzzwords for their "direct repair facilities," one example being "Circle of Dependability" repair facilities used by Farmers.
Please understand that no matter whether the damages are to your home or to your vehicle, you have the absolute right to have your property returned to pre-loss condition by a contractor or repair facility of your own choosing. In fact, the practice of insurance companies attempting to direct their policyholders to certain "preferred" facilities, a practice known as "steering" is, at a minimum, frowned upon by state insurance departments and, in fact, is specifically illegal in a number of states. The general rule is that, if asked, the insurance company can recommend repair facilities to its policyholders, but they are specifically prohibited from requiring or affirmatively "steering" you toward any particular facility. Insurance companies often justify their "preference" by representing that "if you use one of our preferred facilities, we will guarantee that the repairs are done satisfactorily." Be careful to not be overly swayed by these "assurances" for the simple reason that any reputable repair facility that you would rather have perform the repairs is going to be a facility that will stand behind its work anyway. The bottom line is that if you use an insurance company's preferred facility, you may well find that the repair facility is more interested in listening to, and satisfying, the insurance company rather than satisfying you. On the other hand, if you have knowledge that a preferred facility does acceptable work and the facility will listen to and honor your wishes, using a preferred facility can be an acceptable choice.
