Auto insurance is a highly competitive business. To help policyholders
with the auto repair process, some insurance companies offer direct
repair programs so that their customers have easy access to a
recommended body shop. Some also offer one-stop shopping where a damaged
car can get dropped off and an adjuster handles the claim, the car is
fixed and often a replacement rental car is provided. When a car is
damaged, an auto repair shop may provide a choice between original
equipment manufacturer (OEM) and generic replacement parts. When
navigating the claims process, it is important to understand the
different options, and what choices are available to you under your
policy. These frequently asked consumer questions can help guide you
through the process.
Q. What is a Direct Repair Program?
A. A Direct Repair Program (DRP) is a network of auto repair shops and dealerships approved by an insurer.
Q. Why do auto insurers offer Direct Repair Programs?
A. DRPs help auto insurers provide their customers with quality repairs at a reasonable cost.
Q. Are DRP auto repair shops reliable?
Auto repair shops and dealerships that participate in the program are
carefully vetted by insurers to ensure they provide quality repairs and
service to policyholders. Insurers also offer customers a lifetime
guarantee on workmanship decides to use the DRP shops.
Q. May I use an auto repair shop of my choice for insured repairs?
A. Yes. Consumers have the right to go to the auto shop of their choice.
If their insurance company offers a direct repair program, they do not
have to use one of their auto repair programs. Policyholders should talk
to their insurance company about their specific procedures.
Q. What are generic crash parts?
A. There are two types of crash parts: original equipment manufacturer
(OEM) parts, which are supplied by auto manufacturers, which sell them
under their own name; and generic, or aftermarket, crash parts. Generic
parts are frequently produced in the same factory as the OEM parts, but
are also produced by independent manufacturers. They are generally
limited to the cosmetic parts of the car that form the outside “skin”
frequently damaged in an auto crash such as fenders, hoods and door
panels.
Q. Are generic parts safe?
A. Yes. Studies show that these exterior generic parts do not compromise
the safety of a vehicle. Auto insurers only want safe cars put back on
the road—not only will they be insuring these cars, they are also
committed to auto and highway safety. In addition, the independent,
non-profit organization Certified Automotive Parts Association (CAPA)
rigorously inspects generic auto parts and guarantees that their quality
meets its standards.
Q. Do I have a choice of generic or OEM parts?
Some auto insurance companies offer their policyholders a choice between
generic and OEM parts. Some policies actually specify that only
original equipment manufacturer parts must be used for repairs, while
others require this only when repairing recent model cars. A few states
mandate that insurance companies must offer generic parts when they
exist. These requirements and options will be included in your auto
policy—read it carefully and speak with an insurance professional to
best understand your coverage.
Q. Can my insurance company require me to use certain types of auto repair parts?
A. No. Insurance companies cannot require a policyholder to use only
certain kinds of auto repair parts. However, if the company’s rates are
based on using a certain type of part, the insurer can ask you to pay
the difference if the part you prefer is more expensive.
Q. What if the parts don’t fit?
A. A generic part is no less likely to fit a vehicle than an OEM part.
In the unlikely event that either type of part does not fit the vehicle,
the insurance company will often pay to replace the part at no extra
cost.
Q. How can I find out if generic parts are used in repairing my car?
A. Many states require that estimates prepared by auto body shops
disclose whether the repair job will use generic parts. Insurers are
also required to disclose that they are using parts “at least equal in
the kind and quality in terms of fit, quality, and performance to the
original manufacturer parts they are replacing.” If in doubt, ask your
auto body repair specialist what types of parts are being installed.
Q. Will the use of generic parts reduce the value of my car?
A. No. Diminished value could
occur if your vehicle has a significant collision history. However
your car would not be diminished further in value by the use of generic
parts.
Q. What if I lease my car?
A. Lease agreements clearly spell out what type of parts may or may not be used when a car is repaired.
Q. What are the benefits of using generic parts?
A. There are many benefits to using generic parts. First, they are 26 to
50 percent less expensive than OEM parts and often have longer
warranties. The introduction of aftermarket parts has also forced down
the price of OEM parts by creating competition in the marketplace.
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