When purchasing an insurance product, replacement cost is usually preferred over actual cash value settlement policies. However, insurance claims are settled based on the language written in the policy. Fortunately, there are policy endorsements that change or add additional coverage.
Let’s discuss one such endorsement that can be added to the Personal Auto Policy, NC 03 35 Loss Settlement – Original Manufacturer Parts. This might be a good endorsement if you prefer original manufacturer parts to be used to repair your vehicle.
The NC 03 35 endorsement pays for losses if the repair results in the replacement of exterior sheet metal and/or exterior plastic parts; replacement will be with original manufacturers’ parts, if available. If original sheet metal and plastic parts are not available, other parts may be used but are required to be at least equivalent in terms of fit, quality, performance and warranty to the original parts.
N.C. Living
Affects on Automobile Insurance Rates
For repairs resulting in replacing parts other than exterior sheet metal and/or exterior plastic parts, the company may require or specify the use of parts not produced by or for the original equipment manufacturer. However, these parts are required to be at least equivalent in terms of fit, quality, performance and warranty to the original parts.
Original Parts Preferred
A concern I hear about this endorsement is when there is a loss to an insured’s windshield, as the endorsement specifically refers to repairs involving exterior sheet metal and plastic parts, not windshields. Windshields are not just sheets of glass anymore, as many contain special coatings, rain sensors, an advanced driver assistance system, cameras, sensors, heating elements for defrosting, etc. So, in the case of windshield damage, this endorsement does not guarantee an original manufactured windshield. The replacement windshield would still need to meet the vehicle’s operating requirements; just know it may be from a different manufacturer.
N.C. Living
Affects on Automobile Insurance Rates
The insurance company’s limit of liability for the original equipment manufacturer parts would be the actual cash value of the stolen or damaged property or the amount necessary to repair or replace the property.
Feel free to reach out to your local Farm Bureau agent for information regarding this and other endorsements available to provide additional or specialty coverage not provided by the general policy.
