Minutes of Meeting

Automobile Damage Appraisers Licensing Board Subcommittee

A meeting of the Appraisal Licensing Board Subcommittee was held at the office of Commonwealth Automobile Reinsurers on -

Tuesday, March 17, 1998 at 1:00 P.M.

The following members were present -

Mr. Robert Woods, Jr. C N A Insurance Companies

Mr. Michael Doran Premier Insurance Company

Mr. Dave Antocci Commerce Insurance Company

Mr. Bill Benoit * Sentry Insurance Company

* Substitution for Mr. Ciro Fei

Also present were -

Mr. Bob Correia Liberty Mutual Insurance Company

Mr. James Mutschler Liberty Mutual Insurance Company

Mr. David Castro Commercial Union Insurance Company

Mr. Kevin McCarron Arbella Mutual Insurance Company

Mr. Doug Jones Arbella Mutual Insurance Company

Mr. Bill Kelleher Plymouth Rock Assurance Corporation

Mr. Steve Tague Metropolitan Property & Casualty

Mr. Denis LaFleur Commerce Insurance Company

Ms. Marie Mandeville Premier Insurance Company

Ms. Dawne Harris Mills Trust Insurance Company

Attorney Henry Donlon Henry Donlon Jr., Attorney At Law


Minutes of Meeting March 17, 1998

Automobile Damage Appraisers Licensing Board Page 2

Representative Producer –

Mr. James Doherty Doherty Insurance Agency

C.A.R. Staff -

Ms. Valerie Gedziun Vice President - Claims

Mr. Robert Bell Claims Manager

Ms. Susie Almonte Winters Claims Analyst

C.A.

98.41 Automobile Damage Appraisers Licensing Board

Mr. Woods reported on the results of meeting that CNA, Trust, and Commerce had with the Department of Revenue on sales tax on paint and materials. Mr. Woods said the Department of Revenue felt the issue of paint and materials is beyond their expertise but they were willing to talk more on the subject. The Department of Revenue also said they would not have issued what the Licensing Board issued for the ruling on sales tax on paint and materials. They did express a willingness to meet with the Licensing Board, the Mass Auto Body Association, and members of the insurance industry to discuss the issue.

Mr. Woods said that at the Automobile Damage Appraisers Licensing Board meeting of January 27th the three companies acting individually agreed to write a letter to the Department of Revenue asking for the opportunity to discuss what may be taxable. Mr. Woods distributed copies of the letter to the subcommittee. He added that at both the January and February meetings of the ADALB the three companies reported that they continued to attempt to set up meetings with the DOR. Mr. Woods said that while the companies and the ADALB were willing to discuss this issue, the MABA was not, unless the DOR was present. In addition, Mr. Woods felt the Letter Ruling 97-1 was in error as the DOR would not have paraphrased their letter in this manner. He said there are also two places in the Ruling where references are made to retail mark-up and that is not correct. Mr. Woods said that another meeting between the DOR, the ADALB, MABA, and the individual insurers was scheduled for March 20th.

Mr. Woods reviewed the chronology of the paint and materials issue for the subcommittee starting with a letter to the ADALB from the MABA dated November 25, 1996 and ending with the letter to ADALB Chairman Gilbert Cox requesting that implementation of the Advisory Ruling be suspended pending further review.


Minutes of Meeting March 17, 1998

Automobile Damage Appraisers Licensing Board Page 3

Mr. Bell said that since there is some confusion over the use of the Mitchell Guide on the computation of paint and material costs perhaps they could be requested to talk to the subcommittee on the proper use of the guide. The subcommittee agreed and asked Mr. Bell to contact Mitchell.

There being no further business Mr. Doran made a motion to adjourn. Mr. Doherty seconded and the motion passed unanimously.

Robert W. Bell, CPCU

Claims Manager

Boston, Massachusetts

April 1, 1998