California Department of Insurance Proposes Amendments to Aftermarket Parts Regulations
June 28, 2012

by Katie O'Mara,

The California Department of Insurance (DOI) has submitted amendments to the Standards for Repair and Use of Aftermarket Parts Regulation. Included in the amendments is language that would require insurer’s to disclose in writing if they require “that such parts are of like kind, quality, safety, fit and performance as original equipment manufacturer replacement crash parts.”

“No insurer shall willfully depart from or disregard accepted trade standards for good and workmanlike repair in the preparation of claim settlement offers or estimates prepared by or for the insurer,” reads the proposed amendments from the DOI. “An insurer shall not prepare an estimate that is less favorable to the claimant than the standards, costs and guidelines provided by the third-party automobile collision repair estimating software used by the insurer to prepare the estimate.”

The amendments also specify that the insurer would incur the cost of replacing non-original replacement parts if they require those parts to be used.

Insurers specifying the use of non-original equipment manufacturer replacement crash parts that the insurer has implied, actual, or constructive knowledge are not equal to the original equipment manufacturer parts in terms of kind, quality, safety, fit and performance, or do not otherwise comply with this section, shall pay for the costs associated with returning the part and the cost to remove and replace the non-original equipment manufacturer part with a compliant non-original equipment manufacturer part or an original equipment manufacturer part.

Comments on the proposed amendments must be submitted by August 9, 2012.

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