After-Market Auto Parts Take Heat

Auto repair shop attendees at the recently held Canadian Collision Industry Congress (CCIC) took aim at a panel of representatives from insurance companies in questioning the use of after-market parts in insured vehicle repairs. The attendees questioned the quality of after-market parts as well as delays to their production schedules caused by poor fitting/sizing and having to deal with customer ire.

Camille Alexander of Allianz Insurance Co. of Canada notes that insurers are definitely moving more toward use of after-market parts in a bid to keep claim costs down. “There will be a ‘trial and error’ process in determining the effective use of after-market parts,” she acknowledges with regard to quality. With Ontario being the first province to bring in specific “legislative language” under Bill-198 authorizing the use of after-market parts, insurers and bodyshops have to work together in maintaining a consistent message on their use in order to avoid the type of class-action lawsuits that have occurred in Quebec and in the U.S., she adds.

Ken Rayner of KA Rayner & Sons Insurance Consultants says insurers also have to do a better job of educating policyholders on the cost benefits of using after-market parts, and that these “savings” are ultimately passed down to them. “Use of after-market parts is supposed to be a cost saving passed onto insureds – this has to be communicated.” Wayne Riley of Aviva Canada Inc. points out that often the “stress factor” on relationships between insurers and auto repair shops is focused on in industry debates, whereas “both sides” have moved closer in cooperation over recent years.