Can Aftermarket Parts Affect Insurance?

It’s true - everyone likes to save a few dollars when they can these days - including your insurance company! There’s often a temptation to buy the generic parts - or aftermarket parts - when making car repairs, rather than purchasing OEM auto parts that can sometimes be much more expensive. While this short term gain may seem appealing, it’s important that you review your car insurance coverage.

It’s possible that if you or your mechanic has installed aftermarket parts on your car and your insurer wasn’t notified, your insurance coverage may change. How? Why? Well, insurance companies love these cheaper parts as much as you do because sometimes they don’t necessarily have to insure them! This isn’t to say that aftermarket parts aren’t always the best option, because sometimes they’re even the only option!

It’s likely that your car insurance company offers an extra product called a Custom Parts and Equipment policy. However, many insurers will require customers to purchase additional coverage for up to $5,000 in Custom Parts and Equipment parts. If you must choose aftermarket parts for your vehicle, it’s important that you call your car insurance agent and let them know which specific aftermarket parts you’ve used. Here are some questions you should ask them:

  • What percentage of the aftermarket parts value will be covered?

  • Will these aftermarket parts be covered at full replacement value, at the actual cost paid for the parts or at the cost minus depreciation to date?

  • Is there a dollar limit to the amount of aftermarket parts covered under the policy?

  • What is the insurer’s policy on using aftermarket parts for certain repair jobs?