Will My Insurance Company Pay for Original Equipment Manufacturer (OEM) Parts After an Accident?

Last Updated on July 30, 2019

If you are involved in an auto accident, you likely feel as though your world is coming to an end.  You are probably bruised, bloodied, depressed and worried about your finances. The quality of the parts the insurance company decides to add to your vehicle during repairs should not be your top concern.  However, every driver should know whether their auto insurance provider is willing to pay for original equipment manufacturer (OEM) parts in the aftermath of an accident.

Why OEM Parts Matter

will insurance pay for oem partsThose who make a living working on automobiles agree it is better to use OEM parts as opposed to aftermarket parts when the repair is necessary.  In general, OEM parts are revered for their high quality. However, there is no guarantee your auto insurance provider will shell out the money necessary to add OEM parts to your vehicle after it is involved in an accident.  If you insist OEM parts are used to repair your vehicle, address the issue with the insurance company’s agent before signing up for a new vehicle insurance policy. The auto insurance policy should explicitly state whether the insurer will cover the cost of OEM replacement parts in the event that you have to file a claim.

Why Some Auto Insurers Prefer Aftermarket Parts

Each auto insurance company is different in terms of the types of automobile parts it is willing to pay for when repairing a vehicle.  Auto insurers are forced to use replacement parts that restore the vehicle to a condition similar to that prior to the accident. Certain auto insurance policies explicitly state they will cover the cost of OEM parts following an insured loss.  Other auto insurance policies state they will merely pay for certain types of OEM parts to be added to a vehicle following a collision.

Insurance providers tend to prefer aftermarket parts as opposed to OEM parts as aftermarket parts are upwards of 60% cheaper.  The cost savings help keep auto insurance premiums at reasonable levels for all drivers insured through the company. However, if you insist on OEM parts being added to your vehicle after an accident, it might be possible to include such a clause in your auto insurance policy’s terms and conditions.  Though the use of OEM parts will undoubtedly hike your premium, it just might be worth the extra money.

Are OEM Parts Really Worth the Extra Money?

Ask anyone who works in the auto industry about the quality of parts used in repairs and you will likely find the vast majority prefer OEM parts.  Generic parts, also known as aftermarket parts, are somewhat of a secondary vehicle parts industry that functions outside the purview of government regulators.  It is possible you and your vehicle will be put at risk if low-quality aftermarket parts are installed after an accident as opposed to the high-quality OEM parts.  However, it must be noted there are some people who insist aftermarket parts are just as safe as OEM parts.

When in doubt, opt for an insurance carrier that insists on providing those involved in accidents with OEM parts.  After all, it is in your interest as well as the auto insurer’s interest to ensure fewer accidents occur and those that do occur are as non-violent as possible.  The bottom line is most of those in-the-know agree OEM parts really will reduce the chances of an accident or at least mitigate the chances of an accident proving worse than it should have been.

What About Older Vehicles?

Auto insurance companies have wide-ranging discretion in terms of whether OEM, aftermarket or even recycled parts are used after a vehicle is involved in a collision.  The part that restores the vehicle to its condition prior to the loss is the part that will be used. As an example, representatives from State Farm Insurance admit they use recycled auto parts when appropriate.  If the vehicle is especially old and the proper parts are unavailable, it might be necessary to match that automobile with a similar part that was constructed aftermarket. However, the majority of such recycled parts are quarter panels, exterior bumpers and other “crash parts” that do not impact the vehicle’s mechanical operation.

Demanding OEM Parts

If you absolutely refuse to have your vehicle repaired with aftermarket parts, you can demand that OEM parts be used.  However, the auto insurer is likely to demand that you pay the price difference between the aftermarket part and the OEM part.  Insurers take this approach to keep auto insurance rates at reasonable levels for all customers.  It might not be worth the time, effort or money to fight for the use of OEM parts in your damaged vehicle. There is a chance the OEM part will not be significantly better than the aftermarket part.  Do some research, get a second opinion on the damage and you might find the use of aftermarket parts will serve you just as well as an OEM part.

James Shaffer
James Shaffer James Shaffer is a writer for InsurancePanda.com and a well-seasoned auto insurance industry veteran. He has a deep knowledge of insurance rules and regulations and is passionate about helping drivers save money on auto insurance. He is responsible for researching and writing about anything auto insurance-related. He holds a bachelor's degree from Bentley University and his work has been quoted by NBC News, CNN, and The Washington Post.
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