The Retail Motor Industry Federation (RMI) wants to clamp down on “phoenix” bodyshops – those which close and then reappear under a different name.
It has called on the Association of British Insurers (ABI) to produce a relevant code of practice.
The RMI said its main concern centred on some insurers continuing to send work to these “new” bodyshops.
Director of the RMI bodyshop services division, Bob Hood said: “We feel the insurance industry can greatly help the body repair centre by ensuring they stop dealing with failed bodyshop businesses that re-appear under a new banner.”
An ABI spokesman said the association had not been formally approached by the RMI about a code of practice.
He said while insurers certainly agreed that they should be using reputable bodyshops, it was not the job of the industry to check the status of the bodyshops with Companies House.
“We are not responsible for the regulating repairers,” he said. “It is a question that could be better addressed back to the RMI.”