Recently, SB 1460, known as the “aftermarket crash parts bill,” died when it didn’t get enough support to go up for vote by the Senate Committee on Judiciary in Sacramento on April 24. Written by Senator Leland Yee, the bill would have basically allowed the use of certified aftermarket parts in repairs, as long as they “shall be presumed sufficient to return the motor vehicle to its pre-loss condition.” Although it looked fairly harmless when read by the untrained eye, in the end, the bill put all of the responsibility on the repairer and the manufacturer of the part and distanced the insurance companies from any accountability for the ongoing performance of the part when used in repairs.
The final blockage of SB 1460 took place on April 18 when the Department of Insurance (DOI) sent a letter to Senator Noreen Evans, Chair of the Senate Committee on the Judiciary, to announce its opposition of the bill. The DOI’s stance was made clear when Insurance Commissioner David Jones stated, “SB 1460, at best, obfuscates a rulemaking process already underway on this matter at CDI to update and improve existing law and, at worst, appears to reverse a long-standing law that has served to protect consumers from defective or inferior aftermarket parts for almost 20 years.”
Jones went on to explain the other issues his department had with the bill, mainly that it negates established laws. He wrote “SB 1460 creates a new, unprecedented legal presumption that ‘certified, new non-OEM crash parts’ are sufficient to return the vehicle to its pre-loss condition using an arbitrary certification process. Existing law obligates the insurance company that required the use of OEM parts in terms of ‘kind, quality, safety, fit and performance.’ SB 1460 shifts current warranty obligations from insurance companies to ‘suppliers,’ thus significantly reducing existing warranty standards to the detriment of consumers. Existing law requires the insurance company that required the use of the non-original manufacture replacement crash parts to warrant such parts are of like kind, quality safety, fit and performance as original equipment manufacturer replacement crash parts.”
CAA Executive Director David McClune was pleased and not surprised when the bill never went to vote on April 24. “The Department of Insurance (DOI) and the Bureau of Automotive Repair (BAR) were both prepared to testify against Senator Yee’s bill, so they pulled it,” McClune said. “We all had problems with the word ‘presumed’ in the bill, because it allows for way too much interpretation. Overall, we felt like it took the wrong approach to addressing issues surrounding non-OEM crash parts and tried to eliminate current law (CCR section 2695.8 (g)). Before they re-introduce a new re-worked bill, they will need to convene a working group of interested stakeholders to conduct discussions and work on alternative approaches to addressing issues surrounding non-OEM crash parts. This proposed legislation just isn’t going away anytime soon and there is no doubt that we will see it again in a new form, maybe this session or next year.”
David Mello, a CAA political activist with 20 years of experience fighting bills like SB 1460, saw some very encouraging things going on during this process. He said, “This was a very shaky bill with big holes in it, so we figured it was destined to fail. The letter from the DOI played a big role, because it said it wasn’t protecting consumers, and that’s the big key. The fact that the BAR also stepped up and opposed the bill was exceptional, because they normally would not take a stance on something like this. And finally, it looks like we have an Insurance Commissioner who is going to listen to us!”
CAA Legislative Advocate Jack Molodanof knows that a re-written SB 1460 will return, but for now it may not be back until next session, he explained. “SB 1460 is definitely gone, but bills in Sacramento never die—they just come back in another form. Senator Yee withheld the bill and it was not heard, so technically it died for the year. We worked the bill and there was a lot of other opposition to it, including the trial lawyers, consumer protection groups and new car dealers, saying this was not the right way to go. Our position has been that aftermarket crash parts have improved over the years and they’re used in the collision industry every day. But, we’re consistently hearing that some of the time they work well, and other times they don’t. SB 1460 implied that these aftermarket parts will work properly every time, and we know that’s not the case. This was the biggest Achilles heel for the bill and the main reason it was defeated, we believe.”