Understanding Aftermarket Parts and Insurance

What Are Aftermarket Parts?

Aftermarket parts are replacement components made by manufacturers other than the original equipment manufacturer (OEM). Similar to generic pharmaceuticals, they offer a cost-effective alternative to OEM parts, often without compromising quality. The Certified Automobile Parts Association (CAPA) ensures these parts meet high safety and quality standards.

How Aftermarket Parts Work

Many consumers prefer aftermarket parts due to their lower cost compared to OEM parts. These parts can be an economical choice when repairing a truck, though they might impact insurance coverage.

Key Takeaways

• Also known as non-OEM or generic parts, aftermarket parts are generally reliable.
• They can be up to 50% less expensive than OEM parts, saving consumers and insurers money.
• Insurance policies often cover aftermarket parts under custom parts and equipment provisions, but coverage limits may apply.

OEM vs. Aftermarket Parts

Aftermarket parts can sometimes be the only option for older trucks and may offer comparable or superior quality to OEM parts. Concerns about warranty voids are addressed by the Magnuson-Moss Act, which prevents manufacturers from requiring the use of specific products to maintain warranties.

Special Considerations

The amount an insured driver can expect to receive for repairs to aftermarket parts and other upgrades depends on the insurer's replacement schedule. Insurers often depreciate the original value of aftermarket parts using a formula, covering only the remaining value. If a claims adjuster deems the truck a total loss, the payment usually reflects the insured loss value, typically excluding upgrades.

Insurance regulations for aftermarket parts vary by state. As of 2017, 31 states required insurers to disclose repair estimates involving Non-OEM parts, 20 states mandated the identification of aftermarket part manufacturers, and 13 states required that these parts be of "like kind and quality" as OEM parts. Additionally, six states required insured consent before using aftermarket parts in repairs.