A Maryland state bill aimed at restricting insurers from ordering non-OEM replacement parts for a new vehicle’s collision repair claims has been withdrawn.
The legislation, which drew opposition from the insurance and aftermarket auto parts industries, failed to draw support from the Maryland House Committee on Economic Matters.
The bill would have prohibited insurance companies from ordering or authorizing non-OEM replacement parts for the first two years after a vehicle’s manufacturing date. This restriction would have applied to fenders, bumpers, door panels, hoods, grilles, wheel wells, and front and rear lamp display panels.
Following the two-year period, insurers would have been permitted to authorize non-OEM aftermarket parts only if a nonprofit, nationally accredited developer of standards had certified the parts.
During a hearing, bill supporters argued that insurers often order inferior non-OEM replacement parts to lower their repair costs – often without the vehicle owner being aware of the compromise in quality.
Opponents countered that the legislation would hinder competition, disputed the argument that OEM parts are generally safer, and predicted that passage of the legislation would result in higher overall collision repair costs.
Representatives from LKQ Corp., Property Casualty Insurers Association of America, Allstate, USAA and the Maryland Insurance Alliance spoke in opposition to the bill.
Supporters testifying included representatives from the Washington Metropolitan Auto Body Association, the Certified Automotive Parts Association and the Maryland Auto Dealers Association.