by Guest » Thu Sep 06, 2012 08:26 pm
the other person insurance took blame and will fix my car how ever , considering i bought my car with orginal factory parts i request and i am bent to have the new parts being oem parts not aftermarket , however both his insurance and my insurance both say they have the right to use what ever parts they want, i happen to know for a fact that i would not be made whole if aftermarket parts are used on my car, if and when it came time to sell it, what are my rights on this
i am in califorina , should i get a lawyer involved , no one was injured , just my car rear end , im not asking for anything else but to be made whole again with orginal factory parts , i have estamtes and all , ive picked my repair shop , who wont use anything that i requested yet if they insurance company wants me to pay more thats again isnt making me whole pre accident ,so what are my options , this just happen on aug 31 2012 and its been a heck of a week dealing with both insurance companies
i am in califorina , should i get a lawyer involved , no one was injured , just my car rear end , im not asking for anything else but to be made whole again with orginal factory parts , i have estamtes and all , ive picked my repair shop , who wont use anything that i requested yet if they insurance company wants me to pay more thats again isnt making me whole pre accident ,so what are my options , this just happen on aug 31 2012 and its been a heck of a week dealing with both insurance companies
Posted: Mon Sep 10, 2012 01:53 pm Post Subject:
Lebrilla vs Farmers is the case I was referring to in california. It was not overturned on appeal.
Max, if you had diamond jewelry stolen from your possession, you'd be happy to have it replaced with zirconium imitation?
Or perhaps if you had an expensive painting insured we could replace it with a print.
I suppose if I wanted to ensure that some parts be certified to be used in servicing a contract so that I could avoid paying for restoration of value, I'd create and put my money in a company that claims that the parts are equal. Oh wait, that's what capa does and is funded by insurers.
Posted: Mon Sep 10, 2012 03:35 pm Post Subject:
Max, if you had diamond jewelry stolen from your possession, you'd be happy to have it replaced with zirconium imitation?
Or perhaps if you had an expensive painting insured we could replace it with a print.
Mike . . . I'm not saying a person shouldn't be entitled to OEM parts if they want them, and I certainly disagree with insurers who refuse to authorize OEMs and essentially demand only aftermarket replacements.
But your diamonds>cubic zirconium and original art>reproduction analogies are not apples-to-apples illustrations. Not even in the same ballpark.
A hood or a door panel is a piece of sheet metal -- it's not a diamond and it's not in the category of original art. Certainly there are different alloys and thicknesses, and LIKE KIND AND QUALITY generally governs that as a descriptor. If the original sheet metal is .030" thick and it's replaced with metal that's .020" thick, that's unacceptable to me on its face. An insurance company might say "Oh, it's only a 1/100" difference, but I recognize that as a 33% reduction in the amount of metal. So, no, I would not necessarily accept that.
But, then again, and this is a personal thing, cars are meaningless objects to me. They are boxes on wheels that transport me and my stuff around town. I don't care about Mercedes-Benzs, Porches, Caddys, Hummers. I would never buy one. If my car were to be banged up in a minor collision and needed a few pieces of sheet metal, I could care less if that came from Detroit or Dimsum, as long as it fits and can be painted to match -- because I would use the insurance company's recommended shop and hold them to their 100% satisfaction guarantee for replacement parts and labor.
Now, as to Lebrilla v Farmers, it WAS overturned on appeal. The original case filing was for certification of a class action, and the trial court denied certification of the class. On appeal, the CA Court of Appeals remanded the case to the trial court -- with no opinion as to the merits of the case, only stating that the trial court erred by not certifying the class. As a result, Farmers settled the matter without a trial for $17 million. "Damaged" policyholders received $40 for their crappy hoods and $20 for their door panels and other "narrow" subset of sheet metal parts.
And that's for the same reasons I outlined above. 030" sheet metal is not the same as .020" -- it falls outside the boundary of LIKE KIND AND QUALITY as required by law. If it is the same .030" thickness but cannot pass the same standard corrosion test, it is NOT LIKE KIND AND QUALITY.
If the only metal that can meet the standard is OEM from the vehicle manufacturer, so be it. The insurer is stuck. But in the matter tcope referred to, the court, in dismissing the case on "procedural grounds" -- which means it can be refiled to meet the proper set of procedures -- said of the expert witness' testimony -- he showed no methodology to prove his points. He was making broad assertions that there is no comparison between OEM parts and aftermarket parts (that non-OEMs are always inferior parts). I don't agree with that either.
The court was putting everyone on notice that mere anecdotal evidence is insufficient to prove this point. "Come back with hard science if you want to prove your case" is what the court was telling the plaintiffs, "or don't come back at all." And that position is in favor of the aftermarket crowd, not the OEMs.
The Farmers settlement has been described in this manner:
"Farmers, under the settlement, is going to continue to be able to use CAPA certified parts in the repair of cars and trucks damaged in an accident, and that is one of the very major aspects of the settlement," [Farmers' attorney Jose] Allen said. "I don't know that there's much to say about the settlement beyond that."
Allen said he did not have any objections to the end result of the settlement. He did, however, object to the choice of words used to describe parts.
"They are non-OEM parts. We don't call them imitation parts. That's a word that the plaintiffs' lawyers like to use," Allen said.
Farmers will educate and train the claim specialists and the Circle of Dependability shops on the complaint process as outlined in the settlement.
"Speaking to body shops, the problems they run into (with certain CAPA certified parts) may lead to CAPA decertifying (those) parts. With the settlement, it requires Farmers to make sure that everyone is aware of the complaint process. (Body shops) can use that to make sure parts get decertified, and bring it to the attention of everybody," [plaintiff's counsel Timothy] Blood explained.
Cubic zirconium is an IMITATION diamond. A non-OEM diamond is something very different -- it's still a diamond.
Posted: Mon Sep 10, 2012 06:21 pm Post Subject:
Oh for pete's sake just write your brand name on with a freaken' sharpie if it's so damned important. That's what your OEM manufactorer does anyway. They don't make their own parts. They call people like PPG or something to patent and manufacture their so called OEM paints. And guess what? Since PPG hold the patents to the paint, they just use the exact same formula on it and slap a PPG lable on, and guess what? You have your aftermarket paint now. Same damn paint, and probably from the same batch. Look at PPG's website if you don't believe me! Ford makes windshields for Chrystler and I'm sure there's other business deals in the like, particularly when dealing with common foreign brand vehicles such as Honda or Kia. Why bother to import paint made in Japan when you can just pay an American company to make it here. All you have to do is slap your "Honda" label on it and charge twice as much. No annoying tarrifs or customs fees. And it certainly plenty of fools who buy into that whole "better quality" myth and hire lawyers who tell them what they want to hear.
Posted: Tue Sep 11, 2012 02:01 am Post Subject:
Crazy you is crazy man.
Materials used to refinish a vehicle at the factory is not even chemically close to what you can apply in the aftermarket or repair trades. Factory package paint only refers to paint packaged at the paint factory mixed in larger quantities. The manufacturer uses a thermal setting paint that requires baking of the paint that would melt your interior. Paint in the repair industry is air dried and chemically cured. Curing can be expedited by paint booths with gas fired heated air for quick dry times. Factory applied paint including undercoats are rarely over 3 mils thick. The mil film thickness of paint applied in the repair industry is seldom less than 6 mils including clears, bases, primers, and sealers.
An nationally known auto parts store sells a hub bearing built to oem specifications built by someone other than the oem. You can buy a hub bearing from the same store for considerably less that was reversed engineered just as aftemarket sheetmetal, but that bearing, even with a lifetime warranty, will likely last a few short years. A coil pack built in China will last 6 months before the plastic cracks allowing current to leak and engine start failure. Oh they will replaced the faulty part with one just like it, but they will not pay for the labor and you will be buying another in 6 months again. Or you could buy one built by the oem contracted manufacturer that will last 100,000 or more miles.
Aftermarket parts were intended to be sold as cost effective parts for people that could not afford or did not want to pay for quality. Aftermarket manufacturers are trying to equate a part that is reverse engineered with one that was manufactured by the original builder of the car and then claim they are equal in quality. Property insurance guarantees that the damaged parts must be equal to or of the same quality as the original part that was damaged. They simply are not.
Posted: Tue Sep 11, 2012 02:12 am Post Subject:
Max I respectfully disagree on the zironium comparison. Both art and diamonds are chattel of appraised value. Cash value policies cover both and require that they be replaced with like kind and quality when a loss is experienced. The analogy is that neither can be replaced with a knockoff or imitation. A cubic zirconium may look just like the original diamond and be of the same cut and to the inexperienced eye, could fool anyone as to the real value. Just as zirconium is a knock off so are imitiation parts because they are reverse engineered. To a non repair expert, they may appear to be of the same quality, but to the trained eye, they are not. This was proven in Smith vs American Family insurance and set a precedent in Missouri as the case was not settled but AmFam lost on the appeal. Just as fake diamonds, fake parts are not of the same value and actually lower the resale value of a vehicle when they are used in the repair.
Does the California code or statutes regarding use of aftermarket parts apply to third party claimants that are not a party to the contract of insurance since they are only stepping into the shoes of the negligent driver and paying a loss under the limits of liability? Are they basically saying that if this is all we would owe our policy holder, this is all we are offering you for settlement?
What are your opinions where the insurer did not authorize the repairs or contract with the shop but paid for the loss in money? In court, judges are siding with shops using assignments of proceeds or claims, asserting that since the insurer could not prove the repair costs were unreasonable or unnecessary and they did not contract for the repairs, that they owe the shortpay. Many of these issues regard the use of a/m parts and refusing to pay for procedures their drp shops would not have charged for.
CALIFORNIA
Wilkins v. Delross and Mason v. Ellis, Sonoma Cty, CA, Superior Court, Case #s SMC-09-174813 & SMC-09-175738
(Oct. 2009)
Rights of third parties (not at-fault drivers recovering against persons who caused accident) to recover reasonable cost of repair rather than insurer-determined lesser amount. "Reasonableness" connotes a range of charges and rates, not one set rate. (State Farm is the insurer involved.)
The two day transcripts of the trial are available to read online if you would like them. The judge stated he did not care how the first party insurer calculated the loss to be. It mattered not to him if they used chicken entrails or straws thrown to the wind to ascertain the costs or labor rates, as tort law prevailed and the third party was not bound to the terms and conditions of the first party contract of insurance.
Posted: Tue Sep 11, 2012 03:15 am Post Subject:
Does the California code or statutes regarding use of aftermarket parts apply to third party claimants that are not a party to the contract of insurance since they are only stepping into the shoes of the negligent driver and paying a loss under the limits of liability?
It would mainly apply to them as the policy would do nothing but over-ride the statute.
Posted: Tue Sep 11, 2012 03:53 am Post Subject:
I understand California is a different world but I just posted a court case where the negligent party's insurance did not prevail in a case regarding settlement in a third party loss. So how could the contract of insurance ever prevail over a statute that it was in conflict with.
Posted: Sat Sep 22, 2012 10:40 pm Post Subject:
Max must have agreed?
Posted: Sun Sep 23, 2012 12:57 am Post Subject:
Sorry to have been out of the loop -- don't know why I didn't receive notice of Mike's prior responses. And I do not entirely agree, either.
imitiation parts
This phrase has been overused and used improperly. The correct term is OEM vs Aftermarket. And those terms cannot be used to make an analogy out of CZ vs diamonds and faked original art.
But, I'm not arguing in favor of insurance companies on this. If the insured wants OEM parts, they have the right to ask for them. The insurance company has the right to say, with respect to the cost, we believe it's unreasonable. That has more of an implication in first party claims than third party claims.
And that brings me to the Small Claims Appeal cases. The Court correctly observed that the issue had nothing to do with the insurance company's payments, but everything to do with the torts committed by the at-fault drivers. They, not the insurance company, had the responsibility to indemnify the damaged parties.
As the Court pointed out, if the insureds were dissatisfied with the amount of payments their insurance company made on their behalf, which were not enough to pay for the repairs, the insureds may have a cause of action against their insurance company.
But the "appeals" cases were not between the third parties and the insurance company. The court held that the repair costs were reasonable (the hourly labor rates were roughly in the middle of all those offered into evidence), and that the appellees were entitled to their damages as awarded by the Small Claims Court. I find nothing improper in that decision. But it is certainly not controlling as far as case law is concerned. It is not a genuine appellate decision that can be stated as precedential. It would be considered "dicta" which is not binding authority.
The matter also had nothing to do with the CA insurance code as the court observed -- it was a matter of tort, not contract. And it mostly had nothing to do with the cost of parts. It had mostly to do with the difference between labor rates billed and what the insurance company wanted to pay. It was a basic tort liability case, and the injured parties were not properly indemnified.
The same argument, perhaps worse, would be made if the insurance company wanted to substitute a CZ stone in place of a diamond or a fake original in place of the real thing. Those are not indemnnities. And, truth be told, in those kinds of claims, there has to be an appraised value in advance, and that value will not be disputed by the insurance company, it will charge a premium to cover the potential loss. So, once again, apples and oranges don't compare.
The coming change to CA law will take away from insurance companies their current right to pay only the parts cost for aftermarket parts when they are available. But the real issue is that the insurance companies have been forcing repair shops to use only aftermarket parts even when the repair shops complain that the parts are inferior or defective. And that's what the CA legislature was responding to.
So, as I read the draft legislation (I have no idea what changes may have been made, because I generally don't follow P&C changes until after the law changes, unlike my greater interest in life, annuity, and disability changes), if the two parts are identical in all essential ways except cost, there may be less support for the OEM parts. But if it can be shown that aftermarket parts are indeed inferior, the insurance companies are wrong to demand their use regardless. And I think that's what the new law is addressing.
So I really don't think we're on opposite sides -- it's all about fairness to claimants (whether first or third party). That's what we ask our clients to pay premiums for. That's what we expect our insurance companies to do. When the insurers place more emphasis on profits vs payments to claimants, they have violated the basic nature of their promises in the contract.
As far as chicken entrails is concerned, the court said:
Quite frankly the contractual relationship between State Farm
and its insured can develop whatever methodology they want to come up with a price on their first party claims. If State Farm chose to determine their price by reading chicken entrails and consulting with the three witches from McBeth, that's fine. I think that's just about as accurate as the
survey itself is. I think that survey from a statistical
standpoint would get a first year college student a flunking
grade. But that's the method they chose. That's the method
that their people agreed to, their insured agreed to. That's
the contract. So be it.
This was not a breach of contract matter. The small claims court awarded damages greater than the insurance company wanted to pay, but the damages were not assessed to the insurance company, they were assessed correctly to the at fault drivers. Those persons have contract claims against their insurer. But they owe the damages as reasonable costs of indemnity to the damaged third parties:
the third party plaintiff is entitled to be compensated for the reasonable cost of repairs that are necessary to restore the vehicle to its pre-accident condition. Plaintiff asserts that the bill submitted by G and C is a reasonable charge. State Farm argues that the amount it tendered is the reasonable sum required. State Farm did not attempt to establish the G and C rate was unreasonable. A reasonable charge implies a range of charges. If the charge falls within that range, it will be deemed to be reasonable. No particular charge can be said to be the only reasonable charge. The G's and C charge fell within the range of reasonableness.
As I said, when it comes to me, personally, I could really care less about auto body parts or mechanical parts, as long as they look and work the way they should. There's plenty of evidence that OEM stuff is just as, if not more, defective as anyone else's. Look at all the MFG recalls that have been made over the past 30-40 years because a part from one of its "suppliers" was defective -- and led to the injuries or deaths of folks before they decided there was a "problem".
Over the years, I've had little or no trouble with any aftermarket parts I've ever used to repair my vehicles. And I haven't had any significant auto body repairs in 40+ years of driving history either. So I may not be the most amenable sounding board.
Posted: Sun Sep 23, 2012 01:07 am Post Subject:
I need to address this separately:
they are only stepping into the shoes of the negligent driver and paying a loss under the limits of liability?
That's an incorrect statement. The insurance company does not "step into the shoes" of their insured, they are their insured's "wallet." When they lose sight of that in search of profits, that's where the problems arise.
Most case law follows the dicta of the court in the Small Claims cases. I don't know of any case law concerning third party claims. Because I'm sure we all agree that no third party has the right to sue the insurance company for nonpayment -- they sue the party that caused their damages.
All the case law concerns the insurance company's defense or lack thereof of its insureds. If the insurance company doesn't want to pay the full loss, then there is (or may be) a breach of contract to the insured. But as tcope has said elsewhere, there is no contract between insurance companies and third party claimants, so a third party cannot bring a breach of contract claim against the insurance company.
I would agree with the insurance company if it proved the charges were unreasonable. But they are rarely, if ever, going to be able to do that in third party actions. First party actions are on a different plane. And that's where the changes coming to CA law are siding with insureds over insurers.
I don't think the changes are unreasonable, except that it will simply be another one of those "You (the consumer) win" and at the same time, "You lose" because insurance companies will simply increase the cost of collision coverage to compensate. Same as trucking companies pass on the increased cost of diesel fuel to those who ship cargo. We all end up paying for it.
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