OEM Endorsement: What It Is and Why Your Car Needs It
When your car needs repairs after an accident, your insurance company wants to use the cheapest parts available — usually aftermarket or recycled components. But if you drive a newer vehicle, a luxury car, or simply want your car restored to its original condition, you need an OEM endorsement.
This guide explains what an OEM endorsement is, how it works, and whether it's worth the extra cost.
What Is an OEM Endorsement?
An OEM endorsement (Original Equipment Manufacturer endorsement) is an optional add-on to your auto insurance policy that requires your insurer to use genuine manufacturer parts when repairing your vehicle — rather than aftermarket, recycled, or generic parts.
OEM Parts Coverage: What It Means for Your Car Repairs
Why Standard Policies Don't Use OEM Parts
Insurance companies default to aftermarket parts because:
- They're 20–50% cheaper than OEM
- They reduce overall claim costs
- Many are CAPA-certified and equivalent in quality
- They help keep premiums lower for all customers
However, aftermarket parts may:
- Not fit as precisely
- Use lower-quality materials
- Lack manufacturer warranty
- Affect resale value
- Cause issues with ADAS systems
What an OEM Endorsement Covers
Covered Components
| Category | Examples |
|---|---|
| Body parts | Fenders, doors, hoods, bumpers, quarter panels |
| Mechanical parts | Engine components, suspension, steering |
| Electrical | Sensors, modules, wiring harnesses |
| Glass | Windshields, windows (some endorsements) |
| Trim | Moldings, emblems, grilles, badges |
What's NOT Covered
- Wear items — Brake pads, tires, wiper blades
- Maintenance parts — Oil filters, air filters
- Betterment — Upgrading beyond original specs
- Custom modifications — Aftermarket additions
How Much Does an OEM Endorsement Cost?
Average Costs
| Vehicle Type | Annual Cost | Monthly Cost |
|---|---|---|
| Economy car | $30–$60 | $3–$5 |
| Midsize sedan | $50–$100 | $4–$8 |
| Luxury vehicle | $100–$200 | $8–$17 |
| Vehicle with ADAS | $75–$150 | $6–$13 |
Companies Offering OEM Endorsements
| Company | Product | Notes |
|---|---|---|
| Travelers | Premier New Car Replacement | Includes OEM for vehicles under 5 years |
| Liberty Mutual | Better Car Replacement | OEM option available |
| Hartford (AARP) | OEM Parts Endorsement | For members |
| Chubb | OEM Guarantee | Included in policies |
| Auto-Owners | OEM Parts Coverage | Optional add-on |
| Erie | OEM Endorsement | Optional add-on |
OEM Endorsement vs. Standard Coverage
| Scenario | Standard Policy | With OEM Endorsement |
|---|---|---|
| Fender replacement | Aftermarket ($300) | OEM ($500) |
| Bumper repair | Recycled ($400) | OEM ($700) |
| Headlight replacement | Aftermarket ($200) | OEM ($450) |
| Hood replacement | Aftermarket ($350) | OEM ($600) |
| Your out-of-pocket | $0 (within policy) | $0 (within policy) |
Do You Need an OEM Endorsement?
You SHOULD Get It If:
- Your car is under 5 years old
- You own a luxury or premium vehicle
- Your car has ADAS features — Cameras/sensors need precise calibration
- You're leasing — Lease agreements may require OEM
- You plan to sell soon — OEM repairs maintain value
You Can SKIP It If:
- Your car is 10+ years old
- You drive an economy vehicle
- You're keeping the car long-term
- Your insurer uses CAPA-certified aftermarket — Quality equivalent
FAQ
What's the difference between an OEM endorsement and OEM parts coverage?
They're essentially the same thing. "OEM endorsement" refers to the policy add-on, while "OEM parts coverage" describes the protection it provides. Both ensure genuine manufacturer parts are used for repairs.
Does an OEM endorsement cover paint and finish?
The endorsement covers OEM parts, which come primed or painted from the manufacturer. However, blending paint to match your car's existing finish is part of the repair process and not specifically an OEM issue.
Can I get an OEM endorsement for a used car?
Yes, but availability may be limited based on vehicle age. Most insurers only offer OEM endorsements for vehicles under 5–7 years old. Older vehicles may not qualify.
Will an OEM endorsement increase my premium at renewal?
The endorsement itself has a fixed cost. However, if you file a claim using OEM parts (which cost more), your future premiums may be slightly higher than if aftermarket parts were used, since the total claim amount is larger.
Does OEM coverage apply to total loss settlements?
No. OEM endorsements only apply to repairable vehicles. If your car is totaled, you receive actual cash value regardless of whether you have OEM coverage. For new cars, consider new car replacement coverage instead.
Conclusion
An OEM endorsement ensures your vehicle is repaired with the same parts it was built with — maintaining fit, function, and value. For newer vehicles, luxury cars, and those with advanced safety systems, the relatively low cost ($30–$200/year) is worth the guarantee.
Before purchasing:
- Check your vehicle's age and warranty status
- Consider whether you plan to sell or trade soon
- Get quotes with and without the endorsement
- Verify if your lease requires OEM parts
- Ask your repair shop about aftermarket quality for your model
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