DENVER -- The next time your car is damaged you’ll probably want to use a body shop you know and trust, but what if that shop is not on the insurance company’s “preferred” or “recommended” list?

State law gives you the right to use the shop of your choice and bars insurance companies from “steering” business to particular repair shops instead of the one a consumer already selected.

So how is it that six years after the law was passed, the Colorado Division of Insurance has yet to find fault or penalize a single company following a complaint?

The CALL7 Investigators discovered the reason for the lack of discipline centers on a disagreement between lawmakers and those charged with enforcing it over what is, or is not, against the law.

“The car was pretty bad damaged. It was T-boned into the railing,” said Kari Johnson about her 2005 Acura.

Johnson had been a customer of Body’s by Brown in Englewood for several years.

“I told [the insurance company] that I had someone I trusted and went through before and they said they had a list of preferred shops,” said Johnson.

She believed she had to use one of the shops recommended by the insurance company.

Johnson told 7NEWS: “After taking the car there and getting it back pretty quickly, we discovered a lot of problems with the car and we took it back over six times to have it repaired and it still wasn't correct.”

Johnson said the problems continued for more than a year before she persuaded her insurance company to let her take the car to Body’s by Brown.

“The car was not repaired properly. They tried to hide work,” said John Patti, owner of Body’s by Brown.

Patti has been in the body shop business for more than 30 years.

A 7NEWS camera was there as he pointed out issues with the repair, including a brand new molding covering a damaged rocker panel, fastening holes drilled out to try and force headlights to fit and a bent radiator support.

Patti said: “The radiator support is like the foundation of your house. If this isn't on straight, nothing else is going to hang straight. Your headlights are going to be crooked, your bumper is going to be crooked, your radiator going to be crooked and nothing will fit.”

It showed when he closed the passenger side door and the seams did not match.

“It gives all the body shops a bad name,” said Patti.

After more than a year of hassle, Johnson said the car was “totaled” and she reached a settlement with the insurance company.

“I don't think I was treated fairly. I have a child and my child rides in that car with me and the car wasn't safe. I would think somebody would have known that,” said Johnson.

It’s no secret that insurance companies seek to pay as little as possible on a claim because it’s smart business and helps prevent fraud.

It’s also no secret that many insurance companies have “preferred shops” or shops that are part of their “Direct Repair Programs” because those shops may offer concessions or discounts to the insurance company.

Discounts or concessions that may or may not be passed on to you.

Patti told 7NEWS he believed any shop offering big discounts to an insurance company “is going to be doing cheaper work.”

“They're going to have to get cheaper parts and they're going to have to do a lot more after-market and parts that are not made with the car,” he said.

His evidence: Kari Johnson’s Acura.

“The front end of the car has a lot of frame damage that was never repaired,” said Patti. “If the estimate was written properly this car would have been a totaled.”

In Colorado, shops work off of a “prevailing rate” which means labor on most repairs should be similar from shop to shop.

If a shop has altered its rate on a repair, you should find an asterisk near the specific part’s labor time/charge on the estimate.

It’s important to note that the “preferred shop” label does not mean a shop will do poor quality work or cut corners. Industry experts agree there are top notch body shops that belong to insurance company Direct Repair Programs, in part because they have to belong in order to get the much needed business from insurance companies.

But how far can a claims representative go in persuading claimants who don’t want to use a “preferred shop” and who is making sure the insurance companies don’t cross the line?

“I just never felt like an insurance company should determine where you took your car to have it repaired,” said state Sen. Ken Kester.

In 2003, Kester introduced the law intended to prevent insurance companies from steering business to their preferred shops.

The law says an insurer or its agent shall not misinform, intimidate, coerce, threaten, induce by incentive or use disincentives to discourage a claimant from using a particular repair business.

It also reads, “An insurer or its agent… shall not directly or indirectly require that appraisals or repairs to motor vehicles be made or not made by a specified repair business.”

Kester told CALL7 Investigator Tony Kovaleski, “Since this law was passed we've had close to a million people move to Colorado and as time goes by these people could have their first accident and unbeknownst to them, this law was in effect. I think it's time we renew everybody's memory and thinking on this and support the legislation as it was passed and maybe put a little more responsibility on the Division of Insurance.”

While Kester believed the law was specific and “has plenty of teeth,” Colorado’s Insurance Commissioner, Marcy Morrison, disagreed.

“It may not be a very good law. It may need improvement,” said Morrison.

Morrison’s office has received nearly 50 complaints against insurance companies since the law was passed.

CALL7 Investigators examined many of the complaints and found the Division of Insurance has not issued a single penalty or punishment against an insurance company.

Kovaleski asked, “Your investigators are not able to prove one of them? Does that seem like this office is out there supporting the consumer?”

“I think the office is doing what it can do,” replied Morrison.

She explained the difficulty lies with proof that steering occurred since most complaints involve the claimant’s or body shop’s word against that of the insurance company.

Ken Erhardt with Kittredge Auto Rebuilders believed he had enough proof to file several complaints with the Division of Insurance.

“I thought I had one, I really did Tony, but doggone it [the Division of Insurance] had the wrong insurance company on the return letter. They didn't even have the paperwork right,” said Erhardt.

“Which side did the Division of Insurance land on?” asked Kovaleski about all of Erhardt’s complaints.

“The insurance company, every time,” said Erhardt.

He told Kovaleski that steering “is the number one problem in the collision repair business,” adding “I believe most consumers don't even know the law exists.”

That may explain why, in six years, there have been fewer than 50 complaints.

But, it doesn’t explain the lack of penalties or the differing interpretations of lawmakers and the Division of Insurance.

“When you see that kind of track record from the Division of Insurance, are you personally disappointed?” Kovaleski asked Sen. Kester.

“Yes, I'm disappointed and concerned,” said Kester.

Complaints, interviews and sources told 7NEWS, common phrases used by insurance companies to push business to preferred shops include, “they’re not on our list, we can’t guarantee the work, that shop is too busy, they’ll be a delay on the adjuster” or even, “it might cost you more.”

Kester said, once a customer has named a shop they want to use, those kinds of statements are a violation of state law.

Morrison said such statements are “good salesmanship” on the part of the insurance company.

She said the same about a telephone recording of an insurance company employee singling out a body shop and describing her company’s policies for future claims.

Claims Representative: So when claimants say I'm taking my vehicle to Body's by Brown, I'll just say, 'you know what, that's fine, here's what you need to be aware of. This is our rental policy and these are what our expectations are.’”

Kovaleski asked Morrison, “Is that a violation of the steering law?”

She said, “I don’t think so.”

Responding to the same recording, Kester said, “I think there’s definitely a violation of the law.”

“You believe that insurance representative crossed the line?” asked Kovaleski.

“Yes I do,” Kester replied.

So who’s right? It’s unclear and that’s the heart of the problem.

After learning of the findings of the CALL7 Investigation, Kester said he plans to push for tougher enforcement of the steering law.

Complaints to the Division of Insurance named many of the major insurance companies in Colorado, and again Morrison said her office could not prove “steering” occurred.

7NEWS spoke to representatives from several major insurance companies and found many believed the law has, as one put it, “a lot of gray area.”

The representatives also said their claims agents are familiar with the law and to avoid conflict many claims representatives have a script to follow when someone files a claim.

Insurance spokespersons also told 7NEWS, the companies’ mail letters to claimants explaining the law and the claimant’s right to choose any body shop they wish.

Claimants interviewed by CALL7 Investigators said the letters and phone calls from claims representatives were often contradictory.

So what can you do if you believe an insurance representative is steering you?

Outside of hiring a lawyer, your best defense if you have the means and legal approval is to record any conversation you have with a claims representative or take very specific notes about the conversation.

Some states require all parties agree to audio recording of a conversation so it may be necessary to consult state law or an attorney.

If you are in a car crash and don’t have a body shop you trust, try calling your dealer and asking them where they would take the car.