body shop estimate vs. insurance claim

What is the name of your state? CA

I had a body shop do an estimate on the repair of my vehicle--I wasn't going to go through my insurance initially.

I also had Progressive do an estimate on the repair of my vehicle but did not decide to go through them until after the body shop had begun working on my vehicle. Since, the body shop had already begun their work, Progressive cut me a check for the repairs. But, Progressive had to stop pay the check (my bank would not cash the co-payable to my lienholder check) and re-issue to the body shop I had selected.

Now, the body shop is saying that since my insurance co. is cutting the check, they have to re-quote the repairs which will increase the cost. And that they will not release my vehicle, which is ready for pick up today, if Progressive is covering the bulk of the cost until they re-quote the repair cost.

Is this legal?

Well, an estimate is just that, an estimate. Until you get the final bill, there's nothing to say that something can't cost more than the original estimate. However, this whole thing with charging more if the insurance company pays instead of you? A dollar is a dollar! But, I'm not sure what the specific laws regarding this are in your state.