The National Conference of Insurance Legislators (NCOIL) has once again postponed making a decision on its controversial proposed Aftermarket Crash Parts Model Act. The model act, which has been nearly a decade in the making, was the subject of two sessions at the recent meeting in South Carolina on March 5-7.

NCOIL's model laws are frequently used as the basis of legislation in individual states.

The aftermarket crash parts model law has been opposed by both the repair and insurance industries, and even some aftermarket parts companies. Discussion of the bill was originally slated for NCOIL's annual meeting in November 2009, but was postponed because of the lengthy debate over the group's proposed airbag fraud model law. The crash parts discussion will continue at NCOIL's July meeting in Boston.

According to Candace Thorson, deputy executive director at NCOIL, there were a few changes made to the model during the March meeting, including changing the terms "refurbished" and "salvaged" to "remanufactured" and "recycled" based on recommendations form the American Recyclers Association.

In July, NCOIL also will consider a proposed amendment to Section 3 of the model related to fines and penalties for non-compliance with the disclosure requirements.

On March 6, legislators held a separate discussion about the portion of the model related to steering, which resulted in more significant changes.

"Back in October, the legislators had determined that steering was really a separate issue, but did not officially separate these issues into a separate model," Thorson says. "During the March 6 meeting they officially separated the steering language into its own separate model."

Thorson expects that NCOIL will call for public comments on the steering model act prior to the July meeting.

For many of the model's opponents, though, discussions already have gone on too long.

"Here's a model that, frankly, NCOIL has been working on for over a decade now, and they have it at this point where you have almost no interested party in support of it," says Aaron Schulenburg, executive director of the Society of Collision Repair Specialists (SCRS). "There's got to be a point where they, as an organization, have to say this isn't the right place or the right venue, or this isn't the right model for us to be looking at."

Both the SCRS and the Automotive Service Association (ASA) have opposed the bill because of language that deems certified aftermarket crash parts to be the equivalent of OEM parts, and also because of some of the notification requirements.

The Alliance of Automobile Manufacturers also opposes the bill, in part because language in Section 4 of the model would potentially establish conditions under which insurers could mandate or require the use of aftermarket parts.

In its public comments before the November meeting, the Alliance also noted that "identifying the manufacturer or distributor of each aftermarket crash part used in a repair provides no consumer benefit if the entity identified is not the one responsible for warranting the part if it turns out to be defective. The insurer that specifies the part should be directly responsible for warranting the part and then can seek reimbursement from the manufacturer or distributor.

Insurance companies also oppose some of the notification requirements, as well as the section of the model that pertains to steering. The current language states that insurers should not recommend or suggest repairs be made at "a particular place or shop or by a particular concern."

According to public comments submitted by a number of insurance industry organizations, these anti-steering restrictions would violate insurers commercial free speech rights. The groups also noted that the level of detail required for parts disclosure would be beyond the capabilities of current estimating systems.

Recently, SCRS and the Collision Industry Conference (CIC) have held several demonstrations, led by SCRS national director Toby Chess, showing that many structural aftermarket parts are made from inferior materials to their OEM counterparts, posing a potential safety risk. Chess repeated these demonstrations at the NCOIL meeting on the exhibit floor.

"He provided that demonstration in the lobby so the legislators could see these parts and understand the dynamics of how they work," Schulenburg says.

According to Thorson, an updated version of the crash parts model should be posted on NCOIL's Web site within the next two weeks. Information on the new steering model act also will be available prior to the July meeting.