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    Personal Insurance Blog

    OEM Parts vs After Market Parts

    Posted by Jane Logan

    Mon, Mar 26, 2018 @ 03:01 PM

    What’s the difference between OEM and After Market Parts?

    • OEM (Original Equipment Manufacturer) parts are “name brand” new parts made by the original manufacturer to meet the specifications of a specific vehicle make and model. Authorized auto dealerships that sell this particular brand of vehicle(s) usually have exclusive distribution rights to sell these parts.
    • After Market (Non-OEM) parts are “generic” new parts made by companies other than the original manufacturer.  Independent auto part stores and independent (not auto dealership) repair shops sell these parts.


    Why don’t people want After Market Parts used for repairs?

    Owners believe After Market parts are inferior or less safe than OEM parts.  Independent safety rating organizations such as The Certified Automotive Parts Association (CAPA) and the Insurance Institute for Highway Safety (IIHS) dispute this concern.   If After Market parts weren't as safe as OEM parts, manufacturers would pay the price in product liability lawsuits.  They compete just fine by selling the same quality parts, same specifications, just with lower margins.


    Why do insurance companies use After Market Parts for repairs?

    • Parts are easier to get, reducing repair time.
    • Using After Market parts reduces repair costs by 35%, which in 2010 saved $14.08 Billion.
    • Reducing repair costs reduces premium costs that consumers pay.
    • State law either allows or in some cases requires insurance companies to use After Market parts

    Damaged Vehicle for OEM Blog-1.jpg


    What gives insurance companies the right to use After Market Parts?

     The laws in each state regulate auto repairs. In Massachusetts, 211 CMR 133 ( requires the use of After Market parts if the damaged part meets the guidelines:

    CMR 133.04: Determination of Damage and Cost of Repair

     (1) Appraisers shall specify that damaged parts be repaired rather than replaced unless: the part is damaged beyond repair, or the cost of repair exceeds the cost of replacement with a part of like kind and quality, or the operational safety of the vehicle might otherwise be impaired. When it is determined that a part must be replaced, a rebuilt, aftermarket or used part of like kind and quality shall be used in the appraisal unless:

    (a) the operational safety of the vehicle might otherwise be impaired;

    (b) reasonable and diligent efforts to locate the appropriate rebuilt, aftermarket or used part have been unsuccessful;

    (c) a new original equipment part of like kind and quality is available and will result in the lowest overall repair cost;

    (d) for vehicles insured under policies written on or before December 31, 2003, the vehicle has been used no more than 15,000 miles unless the pre-accident condition warrants otherwise; or.

    (e) for vehicles insured under policies written or renewed on or after January 1, 2004, the vehicle has been used no more than 20,000 miles unless the pre-accident condition warrants otherwise.

    A part is of like kind and quality when it is of equal or better condition than the pre-accident part.


    Are After Market parts really as good and safe as OEM parts?

    The manufacture of After Market parts is regulated and repair shops need to be licensed.  If After Market parts were indeed inferior they would be causing accidents, ultimately increasing costs for insurers.  Using inferior parts isn’t in anyone’s best interest, but using After Market parts is in everyone’s best interest as it increases competition, reduces repair costs, and ultimately lowers insurance premiums.


    Is it worth challenging the insurance carrier requiring I use After Market Parts? 

    If State law allows using After Market parts, your insurance company will authorize these for repair.  If a consumer wants to pay for OEM parts on their own, that is, pay the higher margin the manufacturers get for these, most body shops will agree to use them.  Even so, this can delay repairing your vehicle as the claim can become more complicated.  The longer it takes to negotiate the claim, the longer you’re without a vehicle and/or you’re paying for a rental.


    I’m still not convinced.  Can I buy OEM coverage?

    Yes!  We represent several companies that offer OEM part coverage for personal vehicles (not yet for business insurance), based on the model year and odometer reading/mileage on your vehicle.   As a rule of thumb, the cost is generally 30%-40% additional to the cost of your collision and comprehensive coverage. 


    If you'd like to discuss your personal automobile coverage, call one of the Gordon Atlantic Insurance professionals toll free at (800) 649-3252.  Prefer to type instead of talk? Use the form at the top left of the blog for a return phone call or email.


    Tags: auto claims, OEM Parts, After Market Parts, OEM Coverage

    Insurance Statistics

    Posted by Julia Kirslis

    Thu, Sep 05, 2013 @ 04:03 PM

    Learn your personal insurance statistics with Andrew g gordon incYou might think the idea of insurance is great, but maybe you don't want to take part in it. Many people suffer from an "invincibility complex" in which they think that certain laws and scenarios don't apply to them. For example, a man who has had a little bit to drink and then goes out driving believes that he can drive just as well when slightly drunk versus when he is completely sober. He doesn't understand his own mortality and believes himself to be free of the possible consequences of driving drunk. He considers himself separate from the statistics and probability laws that apply to everyday life.

    Sorry to burst his bubble, but those laws do apply.

    Statistics is a study related to both mathematics and English; it contains elements from both realms. Statistics is when data is collected, organized, analyzed, interpreted, and presented. While statistics sounds simple enough, many things are considered when doing proper statistics, such as outliers that may affect the data and a proper sample to represent the entire population. From this sample, which is representative of the entire population, people like yourself are included. So whether you're an outlier or smack dab in the middle of the ever-so-famous bellcurve, statistics apply to you. So here are some important ones:

    • 1 in every 3 people will be in a car accident during his/her lifetime
    • There are about 40,000 car accident related deaths per year
    • Motor vehicle crashes are the number one cause of death for teenagers and young adults
    • 1 in every 20 homes with home insurance file a claim each year
    • 1 in every 50 homes with home insurance will file a claim each year for property damage caused by storms
    • Often enough, the state minimum requirements for insurance are not enough when you need to file a claim- by trying to save money you might end up losing it- not a real statistic, but useful information nonetheless (Read our blog on why you might want to consider increasing your limits here)

    Good news though! Massachusetts is the state with the lowest death rate when it comes to car crash fatalities. However, that 0.6% chance is still too high for me, and every driver should always make a conscious effort to drive as safely as possible so we can eventually reach that desired number: 0.0%

    Insurance statistics are not meant to frighten you, just inform you of your likelihood of actually filing a claim and using your insurance. The numbers may seem scary, but with them there should also be a sense of comfort because you have insurance, and we will protect you from loss.

    For more insurance statistics, check out these links:

    If you have any other insurance questions or are interested in us shopping around for you, feel free to contact us. We'll certainly help you out with any of your insurance needs, and we hope you stay safe. Learn more about personal insurance here.

    Contact Us!  

    Julia Kirslis

    Tags: insurance, claims, home claims, auto claims, property damage, insurance math, car crash, stats, statistics, probability, likelihood, state minimum damage, fatalities

    What is a No-Loss Letter?

    Posted by Bill Cordaro

    Wed, Jul 31, 2013 @ 11:23 AM

    Definition of a no-loss letter.  Gordon Atlantic Insurance.If your policy has ever been canceled for non-payment, then you most likely have completed and signed a No-Loss letter in order to reinstate your policy.

    Simply put, a no-loss letter is a statement, signed by you, stating that there have been no known losses or claims from the time your policy canceled until the current date.

    Why does the insurance company request this?

    You have asked the insurance company to reinstate your policy (rather than rewriting a new application, with a new policy effective date). A condition of reinstatement is that you have no losses or claims during the time that you were uninsured. The insurance company would not want to reinstate your policy if there were a claim they had to cover during the uninsured period.

    An important word of caution! Insurance companies are not obligated to or may not choose to reinstate your policy. There may be a number of reasons for this, but the most obvious is that you've had too many cancellation warnings in the past. Therefore, you should never allow your policy to cancel with the assumption that it can be reinstated.

    Here is a sample No-Loss Letter:

    This letter confirms that there have been no losses whatsoever from (the date of cancellation) until (the date you sign the statement) that may result in any claim of any kind against its subsidiaries or related companies.

    I understand that the reinstatement of my insurance is conditioned upon this statement and any misstatements make the reinstatement null and void.

    Signed on this date, shown below:

    __________________________ Dated:__/__/____

    If you have any additional questions about No-Loss Letters, contact us in the office at any time.

    Contact Us!

    Bill Cordaro

    Tags: insurance, claims, home claims, auto claims, no loss letter, commercial claims, claim hints, signature, no loss, reinstate insurance, cancelled insurance, cancel, reinstate

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