Vehicle Technology and Damage Disputes – What’s Changing? What’s the Same?

Recent industry publications point to a technology shift in auto repairs, specifically in regard to smart technology in cars. Although vehicle technology is changing and repair costs increasing, the manner in which these damages disputes should be handled remains the same.

Smart cars, or vehicles with advanced driver assistance systems (ADAS), come with features like smart mirrors and bumpers with cameras and sophisticated sensors. Today, half of the new vehicles sold have advanced safety features. In the next year or two, that number may rise to 98%.

Conceptual image of a smart car with sensors tracking nearby cars and objectsWhile these features make vehicles safer, the advanced technology also increases repair costs and loss severity. Even if these sensors or cameras do not need replacement, the original parts might still need to be scanned and/or calibrated to ensure they are working per manufacturer specifications.

Due to the industry’s competitive marketplace, insurers may estimate and pay for these damages differently, which, in turn, could create damage disputes. As with any disputed issue, it will be incumbent upon the parties to effectively argue and support their positions. For example, was it successfully proven that manufacturer’s specifications require replacement or calibration? Was a part’s repair or replacement warranted? Was the market-based competitive rate for repairs effectively presented and argued? Scanning or calibration costs seem to be expenses that all insurers will incur, but even if these damages are disputed, the arbitrator will need to consider the basis for the dispute and whether the argument is supported.

Vehicles with ADAS are on the road today. You may even own one. This issue is not something in our future; it’s beginning now. We’re confident our member arbitrators will be able to resolve the damage disputes that may arise. It’s all in the evidence!
 


Article published in: April 2019 E-Bulletin