Why do insurers dispute repair costs?

Which is worse: having an accident or having to deal with getting your vehicle repaired? Many people in Tennessee might find it hard to decide between the two, especially if they are caught between a repair shop and an insurance company that does not see eye to eye about what repairs are needed and the cost of the work.

Nerdwallet notes that some of the decision-making may already be out of your hands if your policy limits the type of parts that can be used or you must take your vehicle to a shop suggested by the insurer. Other than these, there are several points likely to be negotiated between you, the repair shop and the insurer.

  • Repair or replace: A vehicle repair shop might suggest replacing a certain part of the vehicle in its repair estimate. However, the insurance company may balk at replacing it and want the garage to try repairing it first.
  • Type of replacement: Some insurers may want aftermarket parts to be used instead of parts from the original equipment manufacturer. Aftermarket parts are those made by companies other than the original maker and they are usually cheaper than OEM parts.
  • Repair time: Your insurer may dispute the time it takes to make repairs. Not only do mechanics charge by the hour, but the loaner car carries a daily charge as well.
  • Hourly repair rate: The hourly rate for mechanics can range from $45 to $200 per hour, and your insurance company almost surely will want to negotiate that rate, especially if it is on the higher end of that scale.

For vehicle owners caught between the two, it is important that you not let the negotiation become solely a two-way transaction, with you on the outside. Talk to the repair shop and ask questions so you understand what and why repairs are needed. Then speak with your insurer and make your wishes known.

Although this article contains important information about the automotive repair process, it is general in nature and should not be taken as advice.

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