CEI’s Million Dollar Quality Control Team

Ken Latzko

Southeast Regional Sales Manager, The CEI Group

CEI has done some­thing dif­fer­ent at NAFA this year. You brought a car with acci­dent dam­age as part of your exhib­it. What is the idea behind that? 

CEI has been a sup­port­er of NAFA for almost three decades and we want­ed to pro­vide an oppor­tu­ni­ty for addi­tion­al edu­ca­tion at this year’s I&E Con­fer­ence by allow­ing atten­dees to see vehi­cle dam­age up close and have a chance to dis­cuss the com­plex­i­ties of today’s vehi­cles with some of CEI’s in-house licensed phys­i­cal dam­age apprais­ers.

With every new mod­el year, cars are being man­u­fac­tured with more plas­tic and car­bon fiber parts, safe­ty sys­tems and com­put­ers that result in sig­nif­i­cant­ly more hid­den dam­age after col­li­sions than we used to see years ago. You can’t nec­es­sar­i­ly see it unless you start tak­ing the vehi­cle apart. But because we han­dle so many claims, CEI’s in-house qual­i­ty con­trol team of licensed phys­i­cal dam­age apprais­ers quick­ly become aware of when that kind of dam­age may exist on spe­cif­ic new mod­els, even before the repair work begins. 

The car we brought to NAFA was one that is very preva­lent in many of today’s fleets.  We cut away the out­er pan­els of half of it so we could bring it to events like this and show fleet peo­ple all the hid­den dam­age that result­ed from the acci­dent. While this car doesn’t look that bad, it was in fact totaled, in part because of all the hid­den dam­age.  The whole point of this is to demon­strate how we try to lim­it sur­pris­es for our clients, espe­cial­ly when it comes to sup­ple­ments to ini­tial esti­mates, which nobody real­ly likes to receive.  And because our qual­i­ty con­trol team scrubs every esti­mate, which includes review­ing mul­ti­ple images of every dam­aged vehi­cle, we’ve been suc­cess­ful at keep­ing our sup­ple­ment rate well below the aver­age for the auto body repair indus­try.

Are there oth­er ben­e­fits that your clients see because CEI uses licensed apprais­ers? 

Yes. Beyond antic­i­pat­ing hid­den dam­age and keep­ing sup­ple­ments to a min­i­mum, they also review every esti­mate for accu­ra­cy and poten­tial cost sav­ings.  They check each one to make sure the cor­rect labor hours are being charged, to look for whether less expen­sive after­mar­ket or LKQ [like kind and qual­i­ty] parts can be used and whether a job can be done using paint­less dent repair tech­niques.  As a result, we’ve been able to save mil­lions of dol­lars for our cus­tomers. In 2012, for exam­ple, our qual­i­ty con­trol team saved our acci­dent man­age­ment cus­tomers over $9 mil­lion in doc­u­ment­ed sav­ings through these qual­i­ty con­trol audits. 

That is an impres­sive num­ber. How do you com­mu­ni­cate what you save to your cus­tomers?

We doc­u­ment every pen­ny of sav­ings that we obtain through our qual­i­ty con­trol depart­ment, and present them online in every claim file. CEI is an open book when it comes to our process­es and what we do for our cus­tomers. Every time our team of qual­i­ty con­trol apprais­ers iden­ti­fies sav­ings, they doc­u­ment it in our Claim­sLink™ sys­tem and that gets post­ed online for our cus­tomers to see. It is not just a lit­tle note in the file. They can actu­al­ly access graphs, data files and, reports all show­ing the qual­i­ty con­trol audits that our qual­i­ty con­trol team has processed on their behalf.

How about sub­ro­ga­tion?

With respect to sub­ro­ga­tion, we are able to help our cus­tomers recov­er more of the mon­ey they’re due from at-fault, third-par­ty dri­vers than they could on their own. Num­ber one, we do it very quick­ly. Our aver­age recov­ery time is less than 60 days, which is excel­lent when com­pared with the indus­try. We also take advan­tage of enhanced sub­ro­ga­tion tech­nol­o­gy through elec­tron­ic col­lec­tion tech­nol­o­gy.  This tech­nol­o­gy enables us to com­mu­ni­cate, nego­ti­ate and trans­fer all the doc­u­ments for loss recov­ery demands to the adverse car­ri­er in dig­i­tal for­mat, fed direct­ly into the car­ri­ers’ file sys­tems.  This cuts an enor­mous amount of time off the recov­ery process.

In addi­tion to using the lat­est tech­nol­o­gy, we’re very thor­ough.  We col­lect all the rel­e­vant acci­dent reports and ana­lyze them care­ful­ly, with con­sid­er­a­tion to the loss recov­ery laws in every state, and build a case we’re con­fi­dent of. We also ask for oth­er items such as loss of use and dimin­ished val­ue on the vehi­cles to try to recov­er more than the cus­tomer actu­al­ly spent.  In doing so, we recov­er for our cus­tomers around 94 per­cent of all the dol­lars we pur­sue, which amounts to around about $35 mil­lion dol­lars a year.


Ken Latzko is CEI’s south­east region­al sales man­ag­er.  He joined CEI’s fleet oper­a­tions depart­ment in 2004 after grad­u­at­ing with a bachelor’s degree from St. Joseph’s Uni­ver­si­ty in Philadel­phia, PA.  Since then, he has held posi­tions of increas­ing respon­si­bil­i­ty in the company’s client ser­vices, strate­gic account ser­vices and sales and mar­ket­ing depart­ments. 

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