Understanding Car Accident Claims

What To Do When The Insurance Company Rejects The Auto Repair Estimates

by Lois Gibson

It's not unusual for a vehicle to need repairs after an auto accident, and either you or the insurance company (sometimes both) will secure estimates from repair shops detailing the cost of making the vehicle look and function like it did before the accident occurred. Unfortunately, it's equally common for insurance companies to take issue with the cost of repairs and reject the estimates they receive. Here are some reasons why this may occur in your case and your options for dealing with the issue.

Reasons Repair Estimates are Rejected

There are several reasons why an insurance company may not want to approve the estimate they receive to fix your vehicle. The company's primary goal is to pay as little on your claim as it can. So, as you can imagine, a lot of the the reasons are monetarily motivated:

  • Type of parts used – Insurance companies prefer repair shops use aftermarket parts rather than those from the manufacturer because aftermarket parts tend to be cheaper.
  • Labor rate – Some repair shops charge more for labor than others, and the insurance company may feel the per hour amount is too high.
  • How long the repair will take – Along those same lines, the insurance may feel the length of time the repair shop estimates it will take to make the repairs is too long.
  • Repair or replace – Another argument the insurance company and the repair shop may have is whether the part should be repaired or replaced. The insurance provider will typically argue for the cheaper option (e.g. repair the part if replacing it is more expensive and vice versa).

The insurance company may also reject the estimate if it contains mistakes, such as listing you need one type of part when you really need another. However, this issue is easily corrected and typically not the source of the conflicts that can occur between insurance companies and auto repair shops over estimates.

Resolving the Issue

At the end of the day, you just want to get your vehicle fixed, and mediating a dispute between the insurance company and the repair shop is likely the last thing you want to do. In many cases, your insurance provider and the repair company will work things out, and the estimate will be approved. Sometimes, though, you will have to get directly involved, especially if you have special needs your insurance provider doesn't want to address.

For example, the aftermarket vs. OEM parts issue can be a problem. While aftermarket parts do tend to be cheaper, the quality may not be as good as OEM parts. This means you may not get as much use out of them before you must repair or replace the part again. One way to get around this is to look at your insurance policy to determine whether it specifies the type of parts that should be used. If it says OEM parts are covered, point that out to the insurance adjuster handling your case.

Another option is to show why aftermarket parts may not be suitable for the repair. For example, if there are safety concerns regarding the use of the part (e.g. there was a recall), you could use that to force the company to rethink its position in this particular instance. You can use this same tactic when it comes to the repair or replace question. If repairing the part will make the vehicle less safe to drive, pointing that out will likely get the company to change its mind and accept the repair shop's recommendation to replace the part.

Lastly, sometimes reminding the insurance adjuster that the company is obligated to indemnify you (i.e. restore your vehicle to the condition it was in before the accident), may also get it to change its tune, especially if you can show the company's actions are harming you in some way. For example, showing that using aftermarket parts will reduce the market value of your vehicle may make the company agree to use OEM parts instead.

For more information about this issue or assistance dealing with a stubborn insurance company, contact a car accident attorney.