I came across this interesting article on CNN.com regarding a massive class action lawsuit involving hundreds of auto bodys from nearly every State in the Country against the insurance industry and major insurance companies. The complaint at the heart of the lawsuit concerns the use of old and/or junk parts in the repair of vehicles and steering by the insurance company to “preferred” body shops. The body shops along with Attorney Generals representing several States have initiated this action to end both of these practices by the insurance company which they feel are unsafe and deceptive.
LKQ / USED PARTS IN THE REPAIR OF A VEHICLE
The term LKQ stands for Like Kind and Quality. It means a replacement part that came off of a previously totaled or salvaged vehicle. Massive salvage yards are in every corner of the country with thousands of vehicles that were deemed total losses following an auto accident. These salvage yards remove every piece of a vehicle and post them for sale. When a body shop or insurance company calls the salvage yard looking for a 2004 Camry headlight, they will very likely have one in stock. Then that used headlight goes into your repaired 2004 Camry. The insurance companies claim that they do not owe for a brand new Toyota headlight because the car being fixed is not new. In other words, the insurance companies justify this practice by saying “we replaced a ten year old Camry headlight with another ten year old Camry headlight.” There may be some fair rationale to that argument. This lawsuit alleges, however, that used parts in a salvage yard are not always safe or in the best condition. For that reason, forcing body shops to use such parts can potentially create a hazardous situation. And lets be honest, if a tree falls on your house and you make a homeowners claim, would you expect your contractor to use 30 year old wood while re-constructing your house or brand new materials? Junk parts are just that – junk.