"Zero-Deductible" States Are Not as Simple as They Sound — Here's What Shops Need to Know

States that allow policyholders to receive glass repair or replacement without paying a deductible still impose operational limits on shops. Commonly called "zero-deductible" or "full glass" states, these jurisdictions include Florida, Kentucky, South Carolina and a handful of others — but the label oversimplifies what shops can and cannot do under the policies their customers hold.

Zero-deductible status does not eliminate insurer oversight of claims. Insurers in these states can still require prior authorization for replacement versus repair, can still specify or preference certain TPAs and can still enforce their own customary-and-reasonable pricing standards. A shop that bills an unusually high rate for a simple windshield replacement in a zero-deductible state is still exposed to a claim dispute or short-payment from the insurer.

Zero-deductible laws typically apply to comprehensive coverage for glass — not to collision coverage, and not to every type of glass on the vehicle. Some policies extend zero-deductible status to all glazing; others limit it to windshields only. Shops that assumed a broad zero-deductible right and billed for a rear backlite or door glass without confirming the specific coverage language risked a denial.

Assignment-of-benefits laws, which several states had recently enacted or were considering, added another layer of complexity. In states with AOB bans, a policyholder cannot sign over their claim rights to the shop — meaning the shop had to manage the claim as the consumer's agent, not as the claim holder in its own right. Shops accustomed to operating under AOB arrangements in pre-ban states needed to restructure their paperwork and customer communication when entering or operating in AOB-restricted markets.

The issue was particularly timely given the legislative activity underway across the country. Shops doing business in multiple states, or shops in states actively considering NCOIL-style legislation, needed to understand the baseline rules of their current jurisdiction before layering on the additional requirements a new bill might impose.