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Insurance in Depth: OEM Endorsements

auto insurance repairs

As you may recall from our article So You Think You Have Full Coverage, if you don’t have an OEM Endorsement in your auto insurance policy you are likely going to receive aftermarket parts in any covered repairs. It is “one of the less well known facts about insurance; that they don’t use parts from auto manufacturers. The aftermarket parts they ask repair shops to place in your vehicle may not be up to your standards, but it’s part of how they keep their costs down.”

What is OEM?

OEM is an acronym for Original Equipment Manufacturer and refers to the company that manufactures the products or components originally. In automotive terms it references the company that makes replacement parts as being the original manufacturer of your vehicle. Aftermarket parts are spare parts that are compatible with the original part, but not manufactured by the original manufacturer.

Why Does OEM Matter?

Some insurance companies offer an OEM Endorsement for a slight additional charge, to use parts only directly from the manufacturer, so why pay the additional charge? If you have a luxury or high end automobile like a Mercedes or BMW in Las Vegas, and you happen to get in a fender bender, you will likely want a part from your manufacturer, not one that simply fits. Should you ever consider reselling your car, trading up, or even just keeping it for an extended period of time, you will want a part that carries the same trusted name as the one on your automobile.

Know What to Ask

Do be aware that even in OEM Endorsement coverage there may be times that OEM parts are not used. There is typically a clause that states that should OEM parts not be available, perhaps your manufacturer went out of business, stopped making the part, or is out of stock, you will receive the aftermarket versions instead. Be sure to ask your Las Vegas EINSURE broker about your policy and what all the clauses mean.

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