Is it illegal for an auto body repair shop to "absorb" $500.00 of my $1,000 deductible?

I was involved in an auto accident with $5,000 or so damages to my auto. Owner of repair shop tells me if I have a $500.00 deductible, he'll absorb the cost and it won't cost me a penny. He says, "If it's $1,000.00 then I'll absorb $500.00" He also agreed to take care of my car rental,... show more I was involved in an auto accident with $5,000 or so damages to my auto. Owner of repair shop tells me if I have a $500.00 deductible, he'll absorb the cost and it won't cost me a penny.
He says, "If it's $1,000.00 then I'll absorb $500.00" He also agreed to take care of my car rental, and sends me to Hertz who he sends other customers to when their cars being repaired. I pick up my auto one month later, leave the rental car with him to return (since he said he was paying for it).
Last Friday I see my card is charged for the car rental, I call Hertz and they say "We will talk to him and if he said he's paying, he does that for other customers too." They call him, he says, "I'm not paying". I need to know if he what he did with the insurance claim was illegal. Or did he really absorb the difference and do something to help me out? I am paying him a visit tomorrow with an attorney friend of mine after we go to Hertz and get their side. Did he break the law? Can he lose license
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