A $17 million verdict in a class-action lawsuit concerning the use of aftermarket auto parts has gone against an insurer who used non-OEM or salvaged OEM parts when repairing some of its Missouri customers' automobiles.

The class action, Smith, et al., v. American Family Mutual Insurance Company, was first filed in 2003 as a breach of contract suit and was nationwide in its scope. However, the Missouri Supreme Court limited the case to just Missouri policyholders.

In court documents, the insurer was accused of basing its repair payouts on the cost of non-OEM parts and omitting some repairs, thereby breaching contract to repair the vehicle to pre-loss condition. According to a transcript of the opinion, American Family Mutual's repair guidelines stipulated that adjusters were to use non-OEM or salvaged OEM parts for automobiles that were older than three years. These guidelines were apparently later integrated into an electronic estimating system that automatically quoted non-OEM crash parts for certain model years. It was alleged that the estimating system also failed to include the cost of other associated costs of repair, including seat belt tests, wheel alignments, corrosion protection, and more. The plaintiffs contended that this meant inferior parts were used to repair their vehicles.