Buried in the fine print of some auto insurance policies is a disclaimer that allows the use of generic, non-genuine parts in collision repairs.
Some of Australia’s largest insurance companies have quietly introduced policies of using generic non-genuine parts in collision repairs.
Permission to use non-genuine parts – which saves some insurance companies millions of dollars each year, but can leave car owners with ill-fitting repairs – is included in the small characters of policies written by major insurers such as AAMI and GIO and others. .
Insurance giants NRMA and RACV are the only major policy providers discovered by Conduct which specifically describe the use of genuine parts in collision repairs.
All major insurers had planned to use “high quality, non-genuine” parts for windshield and radiator replacement.
And they all had the option of using genuine used parts as long as they were in good condition, which smash repairers say is a better option than generic, non-genuine new parts from the ” secondary market”.
The fine print in product disclosure statements that permit the use of non-genuine generic parts in collision repairs is easy to skim.
For example, product disclosure statements for the AAMI and GIO state: “When we authorize repairs to your car, we ensure that the repair work is done properly, we use new parts or, if necessary , quality reusable parts.
“The parts used will not void the warranty provided by the car manufacturer, will conform to the car manufacturer’s specifications and applicable Australian design rules, will be consistent with the age and condition of the car, and will maintain or improve the safety and structural integrity of the car.”
It should be noted that the AAMI and GIO policies refer to “new” parts, but do not specifically mention that they must be original parts.
Using generic “off-brand” parts saves insurance companies millions of dollars every year, but smash repairers are growing frustrated because some non-genuine parts won’t fit properly – and that extends their repair time when warranty claims arise. .
In contrast, the product disclosure statements for NRMA Insurance and RACV Insurance specifically highlight the use of genuine parts.
“If your vehicle is less than three years old, we use new genuine parts (when reasonably available). On vehicles three years or older, we use new genuine parts (when reasonably available). available) or quality non-mechanical reusable parts.
As with other insurers, NRMA Insurance and RACV Insurance note: “Whatever the age of your vehicle, we can use non-original parts for windshields, sunroofs, windows, radiators and air conditioning components.
They also note: “We only use quality non-mechanical reusable parts when they are consistent with the age and condition of your vehicle, do not affect the safety or structural integrity of your vehicle, are to your vehicle manufacturer’s specifications and applicable Australian Design Rules, does not adversely affect the condition of your vehicle after it has been repaired, (and) does not void or affect the warranty supplied by your vehicle manufacturer.
The revelation of the increasingly widespread use of non-original generic parts in collision repairs comes as the Federal Chamber of Automotive Industries released a study which found that nine out of 10 motorists believe they have the right to be informed before non-original parts are fitted. to their car.
The study surveyed over 1,000 Australians planning to buy a new car within the next two years.
The research also found that most drivers surveyed were unaware that auto insurance companies may mandate the use of non-genuine parts in collision repairs.
“Less than two out of 100 people surveyed would be voluntarily excluded from decisions about the quality of parts fitted to their vehicle,” said Tony Weber, chief executive of the Federal Chamber of Automotive Industries.
” The message is clear. If you plan to fit anything other than the tried and tested original part, Australians demand the right to know. It really is a minimum expectation. It’s my car, it’s my choice.
“Australians act as testers of non-genuine parts on behalf of insurers and repairers motivated to fix…cars at the best possible price.”
The Australian Automotive Aftermarket Association (AAAA), which represents independent repairers, has agreed on the need to use genuine parts for safety critical components.
However, the AAAA said the auto industry could encourage wider use of OE parts on more crushed components “with the stroke of a pen” if automakers made OE parts more affordable.
“The auto industry could solve this problem overnight if it simply reduced its inflated parts prices,” said AAAA chief executive Stuart Charity.
“Our view is that airbags, airbag sensors and all safety-critical parts in the crash zone should be original equipment parts,” Mr Charity said.
“Other collision repair parts on the car must be genuine, certified to meet or exceed the specifications of the original part, or be genuine but recycled parts (in good used condition).”
An industry insider, who declined to be named, said Conduct: “From the consumer’s point of view, it is the insurer who saves money, not the customer.”
The insurance industry claims that premiums would be higher without the use of non-genuine generic parts.
“It’s about disclosure,” the industry insider said. “If a replica part is on my car that could impact the value of the car or the performance of the vehicle, I should have the right to know about it – and ideally the right to make a choice. “