Generic Auto Parts: Your Pros and Cons Author:    Posted under: Auto InsuranceAuto Insurance questions answeredAuto Insurance Ratings and Factors


Generic automotive parts are ‘sheet metal components such as hoods, fenders, and doors, which account for the majority of damage to cars during accidents.* These are often referred to as crash parts or cosmetic parts.  Hundreds of car accidents occur each year, and car manufacturers, along with auto repair shops, create revenue from the repair and replacement of the damaged parts.  Prior to the 1970s, the only source of parts was from the manufacturers themselves. 

They had a monopoly of the market; but eventually, other independent companies had produced their own spare parts.  Because they were selling these parts at a much lower price, the original manufacturers were now forced to lower their own price as well. In the present, most states allow the use of generic parts for repair and replacement, thereby allowing consumers to save money.  Back in 1992, it was noted that the price of a spare part for a Toyota Camry dropped to $60 from the original $325, as a result of the healthy competition.**

Your insurance company cannot require you to use only certain kinds of repair parts.  However, some of these companies may ask you to pay for the difference in the amount, if the parts that you want to use will be more expensive than what your policy covers.  If generic parts will be used in an event of a repair, it should be disclosed in your receipt.  This is because the warranty of a generic auto part is different from that of an original part.  However, studies have proven that performance-wise, original parts do not have any major differences with generic parts.  Moreover, insurance companies also guarantee the use of generic parts.  If in case this does not fit properly with the car, they can have it replaced at no extra cost.

Most, if not all, insurance companies offer the choice between using originally manufactured parts or generic parts.  Some always specify using originals for repairs and replacements, especially if the car is a recent model.  In some states, it is required from the insurance company to inform their clients if there are generic parts available, while in some, original parts are required.  As always, it is best to talk to your insurance agent before signing your policy, as to what happens should repairs and replacements be necessary for your vehicle at the event of an accident.

However, there is also a great debate about the government and insurance agencies not putting enough (or any) attention at all to the quality of the generic parts that are manufactured.  Consumer watchdogs are concerned that some car parts are salvaged from junkyards, and are recycled to repair other cars.  If that is the case then the safety of repaired cars are in jeopardy since there is no one held accountable for those generic parts, as opposed to original ones, where the manufacturer is answerable to claims. Fact is, there are only five states which oversee the replacement-part practices of their own territories, and these are Arkansas, Indiana, Kansas, Rhode Island, and West Virginia.**  Since these state regulations are very hazy, insurance companies often have the hand on whether to use original or generic parts for repair.  For cars with older models, limited choices may be available in terms of parts, but the company also makes sure that they look for the best possible option for the client.  Original parts may often be very expensive because they are not kept in stock, and the generic parts on the other hand, may not be readily available as well.

Overall, the use of generic parts makes it possible for lower insurance policy rates.  If the prices of spare parts will increase, you will expect that more people would want to get themselves insured for higher returns given total losses.  This would then resort to higher rates for the insurance.  You get to have the freedom to choose which parts you’d rather use for your car depending on your policy.  You also get to get your car repaired much quicker than you would for originals, given the availability of the parts.  Given that no one wants a junkyard full of wrecked cars in this environmentalist day and age, I do think that these generic auto parts may do a lot more good than the supposed harm they’re claiming it’s responsible for.

*http://old.iii.org/media/presentations/genericautopartspresentation/
http://www.alohainsurance.com/auto_insurance_repair_parts.shtml
** http://www.insure.com/car-insurance/oem-parts-rights.html

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