Insurance

Your automobile insurance policy is a binding legal contract, so it’s essential to read it carefully. Each state has a minimum amount of coverage you are required to have.  For more information, please contact your insurance provide. Here is some basic information to consider.

A standard automobile insurance collision policy covers repairs up to the fair market value of your vehicle, minus any deductible you’ve chosen. Keep in mind that this value may be significantly lower than the cost of replacing your vehicle or paying off your loan balance. If your vehicle is financed or leased, you might need “gap insurance” to cover the difference between what you owe and what the vehicle is worth.

In addition to gap insurance, many companies offer replacement cost coverage, which covers the total cost of replacing your new vehicle(s) in the event of a total loss. Vehicle owners should carefully consider their options.

Insurance companies are increasingly specifying non-OEM (Original Equipment Manufacturer) parts, such as salvage and aftermarket parts, in repair estimates. Here’s an example of policy language that allows an insurance company to use non-OEM parts:

• “(The insurance company’s) preparation of Auto Physical Damage estimates includes: CAPA certified sheet metal parts; quality salvage, rebuilt, reconditioned and/or remanufactured OEM parts, as deemed appropriate by the adjuster to be of like kind and quality; non-certified aftermarket crash parts where the manufacturer’s warranty meets or exceeds the OEM warranty, including headlamps, tail lamps, front/rear bumper covers, and bumper parts (excluding energy absorbers and HSLA reinforcements).”

Some insurers offer specific additional premiums to include the option to repair your vehicle with all OEM parts. Check with your insurer to understand how much this will add to your premiums.

Today’s vehicles are built with advanced high-strength steels, exotic metals, and composite materials, and are equipped with sophisticated crash-mitigation and safety-system technologies. To ensure these systems are repaired to the original standards of form, function, performance, and safety, it’s crucial to use Original Equipment collision replacement parts installed according to the manufacturer’s recommended procedures. No other parts undergo the same level of testing. Therefore, it’s important to know what type of parts your insurer will use in the event of an accident before accepting coverage.