January 8, 2010

Inside Insurance: Rebirth of a wrecked vehicle

By David Colmans

The winter weather across Georgia brings to mind the freeway crash in Atlanta of 27 vehicles the day after snow covered much of north Georgia.

It’s not the wrecks, per se; it’s the damage to the vehicles and how they are repaired. Will the dents and smashed in fender be fixed with original equipment manufacturer (OEM) parts or with aftermarket parts?

Let’s start with what we all need to know. What does your auto insurance policy say about repairs? Don’t know? This is a good opportunity to speak with your insurance agent or your insurance company about what will and what won’t be covered should your vehicle be damaged.

As you can expect, in a real roadway mishap you will have to know whose insurer will take care of the damages. If you are not at fault, it may well be the other driver’s insurance that will be responsible, so you will need to know what to expect from the other insurer’s policy.

In recent years there has been considerable discussion about whether aftermarket sheet metal parts fit as well as OEM parts. In most cases, aftermarket parts are less expensive than OEM parts. That gap has been closing as price competition has brought down the price of OEM parts.

Here’s something helpful about this issue: Each auto insurer has its own rules about how it will handle repairs for a policyholder. In general, though, sheet metal parts such as fenders, hoods, trunk lids, and others may be aftermarket when repaired because they are cosmetic and the aftermarket parts are very acceptable in a repair situation.

Other repair parts such as brakes or air conditioning units may also be aftermarket.

The insurance industry and others created the Certified Auto Parts Association (CAPA) several years ago to develop controls on manufacturing standards for aftermarket-parts through a certification program and later, a database to track these parts and who manufactured them. The database is called CAPA Tracker that connects the CAPA seal number to the exact part and the vehicle on which it’s installed. This database can quickly notify each customer should a part be recalled.

CAPA continues to do random inspections of these parts from the various manufacturers to make sure they meet the proper specifications and to maintain the public’s trust in these certified parts.

Each state may or may not have legislation and regulation regarding aftermarket parts. In Georgia and several other states, the law requires that the logo and identification number or manufacturer’s name be on each part, that the repair estimate must identify non-OEM parts and that a disclosure statement be provided to the vehicle owner.

Consider that Alabama, Georgia and Mississippi have such regulations, but neither Florida, South Carolina nor Texas have such laws and regulations. As usual, and most importantly, it’s up to the policyholder to know and understand what is and what is not covered regarding crash repairs.



David Colmans is the executive director of the Georgia Insurance Information Service. Contact him at (770) 565-3806 or dcolmans@giis.org.