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Repair parts competition could cut car insurance premiums

Legislation that would guarantee consumers access to low-cost alternative collision replacement parts when repairing their vehicles could help lower insurer costs and lead to lower car insurance premiums, industry groups said.

A bill under consideration in Congress called the Access to Repair Parts Act would amend current patent law to promote competition in the automotive replacement parts market. Lack of competition in the parts industry leads to higher costs for consumers, according to the National Association of Mutual Insurance Companies (NAMIC).

NAMIC said higher costs for parts could lead insurance companies to declare more damaged vehicles as total wrecks, which may force insurers to add an estimated $3 billion to car insurance premiums.

The bill is supported by consumer groups as well as the insurance industry.

Other legislation, called the Right to Repair Act, would require that independent repair shops have the same access as dealers to the tools and information to work on computerized late model vehicles.

This would allow more flexibility for car owners in choosing a place to service their vehicles, which proponents said would drive down repair costs for consumers.

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